• Sign In
  • Create Account
  • Sign Out
  • My Account
  • NEWS
  • PRODUCTS
  • CONTRACTORS
  • ENGINEERS
  • RADIANT & HYDRONICS
  • INSIGHTS
  • MEDIA
  • RESOURCES
  • EMAGAZINE
  • SIGN UP!
cart
facebook instagram twitter linkedin youtube
  • CONTRACTORS
  • BATH & KITCHEN PRO
  • BUSINESS MANAGEMENT
  • HIGH EFFICIENCY HOMES
  • TECHNOLOGY
  • WATER TREATMENT
  • PMC COLUMNS
  • PMC COLUMNS
  • Dave Yates: Contractor’s Corner
  • John Siegenthaler: Hydronics Workshop
  • Kenny Chapman: The Blue Collar Coach
  • Matt Michel: Service Plumbing Pros
  • Scott Secor: Heating Perceptions
  • ENGINEERS
  • CONTINUING EDUCATION
  • DECARBONIZATION | ELECTRIFICATION
  • FIRE PROTECTION
  • GEOTHERMAL | SOLAR THERMAL
  • PIPING | PLUMBING | PVF
  • PME COLUMNS
  • PME COLUMNS
  • Christoph Lohr: Strategic Plumbing Insights
  • David Dexter: Plumbing Talking Points
  • James Dipping: Engineer Viewpoints
  • John Seigenthaler: Renewable Heating Design
  • Lowell Manalo: Plumbing Essentials
  • Misty Guard: Guard on Compliance
  • RADIANT & HYDRONICS
  • RADIANT COMFORT REPORT
  • THE GLITCH & THE FIX
  • INSIGHTS
  • CODES
  • GREEN PLUMBING & MECHANICAL
  • PROJECT PROFILES
  • COLUMNS
  • SPONSOR INSIGHTS
  • COLUMNS
  • Codes Corner
  • Natalie Forster: Editorial Opinion
  • Guest Editorial
  • MEDIA
  • PODCASTS
  • VIDEOS
  • WEBINARS
  • RESOURCES
  • INDUSTRY CALENDAR
  • DIRECTORIES
  • EBOOKS
  • PM BOOKSTORE
  • CE CENTER
  • MARKET RESEARCH
  • CLASSIFIEDS
  • EMAGAZINE
  • EMAGAZINE
  • ARCHIVE ISSUES
  • CONTACT
  • ADVERTISE
  • PME EMAGAZINE ARCHIVES
search
cart
facebook instagram twitter linkedin youtube
  • Sign In
  • Create Account
  • Sign Out
  • My Account
  • NEWS
  • PRODUCTS
  • CONTRACTORS
    • BATH & KITCHEN PRO
    • BUSINESS MANAGEMENT
    • HIGH EFFICIENCY HOMES
    • TECHNOLOGY
    • WATER TREATMENT
    • PMC COLUMNS
      • Dave Yates: Contractor’s Corner
      • John Siegenthaler: Hydronics Workshop
      • Kenny Chapman: The Blue Collar Coach
      • Matt Michel: Service Plumbing Pros
      • Scott Secor: Heating Perceptions
  • ENGINEERS
    • CONTINUING EDUCATION
    • DECARBONIZATION | ELECTRIFICATION
    • FIRE PROTECTION
    • GEOTHERMAL | SOLAR THERMAL
    • PIPING | PLUMBING | PVF
    • PME COLUMNS
      • Christoph Lohr: Strategic Plumbing Insights
      • David Dexter: Plumbing Talking Points
      • James Dipping: Engineer Viewpoints
      • John Seigenthaler: Renewable Heating Design
      • Lowell Manalo: Plumbing Essentials
      • Misty Guard: Guard on Compliance
  • RADIANT & HYDRONICS
    • RADIANT COMFORT REPORT
    • THE GLITCH & THE FIX
  • INSIGHTS
    • CODES
    • GREEN PLUMBING & MECHANICAL
    • PROJECT PROFILES
    • COLUMNS
      • Codes Corner
      • Natalie Forster: Editorial Opinion
      • Guest Editorial
    • SPONSOR INSIGHTS
  • MEDIA
    • PODCASTS
    • VIDEOS
    • WEBINARS
  • RESOURCES
    • INDUSTRY CALENDAR
    • DIRECTORIES
    • EBOOKS
    • PM BOOKSTORE
    • CE CENTER
    • MARKET RESEARCH
    • CLASSIFIEDS
  • EMAGAZINE
    • EMAGAZINE
    • ARCHIVE ISSUES
    • CONTACT
    • ADVERTISE
    • PME EMAGAZINE ARCHIVES
  • SIGN UP!
Bath & Kitchen ProNatalie Forster: Editorial Opinion

Building reports send mixed signals

Shortages of plumbers and fitters will make an impact.

By Bob Miodonski
Bob Miodonski Editorial Opinion
July 18, 2013

We’ve seen this collision before when two indicators of nonresidential construction activity are released virtually at the same time, with each moving in a different direction. The divergent reports support comments I’ve heard lately from contractors, wholesalers and manufacturers that the road to economic recovery remains a bumpy one.

In late May, the American Institute of Architects’ Architecture Billings Index trended downward for the first time in nine months, reaching its lowest point since July 2012. Yet, just two days earlier, industry consultant FMI’s 2013 Second Quarter Nonresidential Construction Index reached its highest score since the NRCI started in the first quarter of 2009.

AIA’s ABI is a leading economic indicator of construction activity, reflecting the nine- to 12-month time lag between architecture billings and construction spending. Any score higher than 50 indicates an increase in billings; lower than 50 shows a decrease in design services.

April’s ABI slipped below 50 to 48.6, down from 51.9 where it was in March. Across the country, both the South (52.6) and West (50.7) showed slight increases in billings in April. Decreases in the Midwest (49.4) and Northeast (48.2) were large enough to drop the national ABI below 50.

AIA’s related index that tracks new project inquiries remained well above 50, although it too decreased in April. It went to 58.5 from 60.1 in March.

“Project approval delays are having an adverse effect on the design and construction industry, but again and again we are hearing that it is extremely difficult to obtain financing to move forward on real estate projects,” AIA Chief Economist Kermit Baker says. “However, given that inquiries for new projects continue to be strong, we’re hopeful that this is just a short-term dip.”

Just as AIA doesn’t sound overly concerned about the drop in its billings index, FMI doesn’t appear to be overly excited about its nonresidential construction index hitting a record high.

“This isn’t a bullish trend yet,” FMI says in its report, “but it demonstrates that the nonresidential construction market continues to push upward.”

Construction company executives surveyed by FMI for its second-quarter report say they have seen little impact so far in their public works projects due to sequestration. The cutbacks in federal spending, as you’ll recall, kicked in toward the end of the first quarter.

Similarly, few of the executives have experienced labor shortages at this point, even though the construction industry lost up to 30% of its workforce during the recession. Nearly a quarter of them, however, expect severe shortages of construction laborers a year from now, along with a shortage of select craft tradespeople, such as plumbers.

On a scale of 1 to 5, with 5 indicating a severe labor shortage, exactly 0% of the executives say they’re experiencing a severe shortage of plumbers today. On the other hand, 36% give plumbers a 3 or 4 score, indicating some regional to moderately severe shortages.

A year from now, 9% of the same executives forecast a severe shortage of plumbers. Another 53% anticipate some regional to moderately severe shortages. Similar numbers appear in the survey for sprinkler fitters, pipe fitters and sheet metal workers.

The executives are looking at different solutions to lessen the impact of the expected shortages. These include training for less-skilled labor, greater use of prefabrication and working for immigrant labor reform.

“There is no question that the construction labor market has significantly retracted. It is only a matter of time before demand will exceed supply. We are really concerned about it,” one executive says. “We see a big pent-up demand for new construction developing in our backlog. We don’t have the crews to respond, but we are address-ing the issue now.”

A few companies say wages are rising due to a number of factors. These include the labor shortage, health-care reform and high wages being paid for oil exploration, such as fracking.

Overall, executives report an increase in their labor costs along with a rise in their construction materials costs. Not one of them says these costs were lower in the second quarter than they were in the first.

“While these components add to the cost of construction,” FMI states, “one can also take the view that the market is strong enough for materials producers and labor to seek increases.”

With an expected increase in their backlog, most of the executives see more projects getting the go-ahead in the third quarter. Overall, FMI forecasts 5% growth in nonresidential construction spending this year.

 Bank financing, government spending cutbacks and labor shortages will challenge the construction industry. These and other bumps in the road will bear watching as the nonresidential sector gains strength.  


HELPFUL LINKS:

  • Contact Plumbing & Mechanical
  • American Institute of Architects
  • FMI
  • Follow PM on Twitter!
  • Find PM on Facebook!
KEYWORDS: editorial labor shortage plumbing

Share This Story

Looking for a reprint of this article?
From high-res PDFs to custom plaques, order your copy today!

Miodonski

Bob Miodonski is the former Group Publisher of BNP Media’s Plumbing Group, which consists of industry-leading print and digital magazines, websites and e-newsletters. Titles include: Supply HouseTimes, Plumbing & Mechanical, PM Engineer and Reeves Journal magazines; Bath & Kitchen Pro e-News; PVF e-News; Radiant &Hydronics e-news; and www.RadiantAndHydronics.com.

Recommended Content

JOIN TODAY
to unlock your recommendations.

Already have an account? Sign In

  • Worker using the Milwaukee Tool SWITCH PACK drain cleaner

    Pipeline profits: Drain cleaning, pipe inspection create opportunities

    Drain cleaning and inspection services offer lucrative...
    Green Plumbing and Mechanical
    By: Nicole Krawcke
  • Uponor employee, Arturo Moreno

    The reinvestment in American manufacturing and training

    Plumbing & Mechanical Chief Editor Nicole Krawcke and...
    Plumbing News
    By: Nicole Krawcke and Natalie Forster
  • March 2024 Women in Plumbing hero image of woman engineer overlayed by circle of hexagon shapes with numbers from 1 to 10

    Celebrating 10 Influential Women in the Plumbing Industry

    Celebrating Women's History Month and Women in...
    Plumbing News
    By: Nicole Krawcke
close

1 COMPLIMENTARY ARTICLE(S) LEFT

Loader

Already a Registered User? Sign in now.

Subscribe For Free!
  • eNewsletters
  • Online Registration
  • Subscription Customer Service
  • eMagazine
  • Manage My Preferences

IPEX celebrates grand opening of new Florida distribution center

IPEX celebrates grand opening of new Florida distribution center

Bell & Gossett Illustrates Path to Net-zero at AHR Expo

Bell & Gossett Illustrates Path to Net-zero at AHR Expo

NIBCO Press Solutions

NIBCO Press Solutions

AI can boost efficiency and profitability for plumbing, HVAC contractors

AI can boost efficiency and profitability for plumbing, HVAC contractors

More Videos

Sponsored Content

Sponsored Content is a special paid section where industry companies provide high quality, objective, non-commercial content around topics of interest to the Plumbing & Mechanical audience. All Sponsored Content is supplied by the advertising company and any opinions expressed in this article are those of the author and not necessarily reflect the views of Plumbing & Mechanical or its parent company, BNP Media. Interested in participating in our Sponsored Content section? Contact your local rep!

close
  • J.J. Keller CMV vehicles on road
    Sponsored byJ. J. Keller & Associates, Inc.

    The dash cam game-changer for small business safety

Popular Stories

Underfloor heating installation with drain sewer hole in bathroom close up on water floor heating.

Using hydronics to leverage time-of-use electrical rates

Watts Nexa mobile image

Behind the Wall: Where smart plumbing gets smarter

Six tankless water heaters that feed the nutraceutical manufacturer’s operations.

How to deliver large volumes of hot water quickly and intermittently

PMCE Home-X April 29 Free Webinar: From Legacy to Leadership: Preparing Your Home Services Business for the Next Generation

Events

November 13, 2024

Future Proofing MEP: Navigating the 2026 High Efficiency Water Heating Standards

Join our deep dive into DOE’s new standards so you can future-proof your MEP practice.

EARN: 0.1 ASPE CEU; 1 AIA LU/HSW; 0.1 IACET CEU*; 1 PDH

View All Submit An Event

Poll

Will business be up or down in 2025?

Do you anticipate business in 2025 to be up or down in comparison to 2024?
View Results Poll Archive

Products

The Water Came To A Stop

The Water Came To A Stop

See More Products

Download the FREE Water Conservation, Quality & Safety eBook: Plumbing Trends Increasing Safe Water Availability

Related Articles

  • Radiant will remain viable option as building market picks up

    See More
  • Liberty Pumps President Charlie Cook

    Liberty Pumps celebrates building expansion

    See More
  • Best wishes for a happy 2013

    See More
×

Keep your content unclogged with our newsletters!

Stay in the know on the latest plumbing & piping industry trends.

JOIN TODAY!
  • RESOURCES
    • Advertise
    • Contact Us
    • Directories
    • Store
    • Want More
    • Supply House Times
  • SIGN UP TODAY
    • Create Account
    • eMagazine
    • eNewsletter
    • Customer Service
    • Manage Preferences
  • SERVICES
    • Marketing Services
    • Reprints
    • Market Research
    • List Rental
    • Survey/Respondent Access
  • STAY CONNECTED
    • LinkedIn
    • Facebook
    • Instagram
    • YouTube
    • X (Twitter)
  • PRIVACY
    • PRIVACY POLICY
    • TERMS & CONDITIONS
    • DO NOT SELL MY PERSONAL INFORMATION
    • PRIVACY REQUEST
    • ACCESSIBILITY

Copyright ©2025. All Rights Reserved BNP Media.

Design, CMS, Hosting & Web Development :: ePublishing

search
cart
facebook instagram twitter linkedin youtube
  • Sign In
  • Create Account
  • Sign Out
  • My Account
  • NEWS
  • PRODUCTS
  • CONTRACTORS
    • BATH & KITCHEN PRO
    • BUSINESS MANAGEMENT
    • HIGH EFFICIENCY HOMES
    • TECHNOLOGY
    • WATER TREATMENT
    • PMC COLUMNS
      • Dave Yates: Contractor’s Corner
      • John Siegenthaler: Hydronics Workshop
      • Kenny Chapman: The Blue Collar Coach
      • Matt Michel: Service Plumbing Pros
      • Scott Secor: Heating Perceptions
  • ENGINEERS
    • CONTINUING EDUCATION
    • DECARBONIZATION | ELECTRIFICATION
    • FIRE PROTECTION
    • GEOTHERMAL | SOLAR THERMAL
    • PIPING | PLUMBING | PVF
    • PME COLUMNS
      • Christoph Lohr: Strategic Plumbing Insights
      • David Dexter: Plumbing Talking Points
      • James Dipping: Engineer Viewpoints
      • John Seigenthaler: Renewable Heating Design
      • Lowell Manalo: Plumbing Essentials
      • Misty Guard: Guard on Compliance
  • RADIANT & HYDRONICS
    • RADIANT COMFORT REPORT
    • THE GLITCH & THE FIX
  • INSIGHTS
    • CODES
    • GREEN PLUMBING & MECHANICAL
    • PROJECT PROFILES
    • COLUMNS
      • Codes Corner
      • Natalie Forster: Editorial Opinion
      • Guest Editorial
    • SPONSOR INSIGHTS
  • MEDIA
    • PODCASTS
    • VIDEOS
    • WEBINARS
  • RESOURCES
    • INDUSTRY CALENDAR
    • DIRECTORIES
    • EBOOKS
    • PM BOOKSTORE
    • CE CENTER
    • MARKET RESEARCH
    • CLASSIFIEDS
  • EMAGAZINE
    • EMAGAZINE
    • ARCHIVE ISSUES
    • CONTACT
    • ADVERTISE
    • PME EMAGAZINE ARCHIVES
  • SIGN UP!