Construction contractors and equipment distributors are optimistic that local non-residential construction activity will improve in 2014 compared to the prior year, according to a recent survey administered by Wells Fargo. The Optimism Quotient (OQ) — this survey’s primary benchmark for measuring construction industry executive sentiment — is at a historic high of 124, up 18 points from 106 in 2013, and up from the survey low of 42 in 2009.
Overall industry sentiment
The Optimism Quotient (OQ) presented by Wells Fargo Equipment Finance is this survey’s primary metric for assessing respondents’ sentiment about local non-residential construction activity for the current calendar year compared to the previous year. The OQ for 2014 is a conclusively positive 124. After seeing a slight dip in optimism to 105 in 2013, the OQ is back in record-high territory for the year ahead, signaling executives’ overwhelmingly expressed anticipation that local non-residential activity in 2014 will increase compared to 2013.. The sentiment survey does not predict the degree of growth — only that the coming year will see greater activity than the previous year and that there is broad optimism about the direction of the construction industry. In 2009, the OQ reached an all-time low of 42, and it didn’t recover much in 2010, but it saw rapid increases for each of the next three years. Optimism was somewhat tempered in 2013 when compared to the all-time high recorded in 2012, but it has since rebounded to a record level in 2014.
The results of the full survey can be found here.