Oak Brook, Ill. -- Well Fargo Equipment Finance, a sponsor at the AED Summit, released findings of its quarterly survey last week at the Summit in Orlando.
The Construction Optimism Quotient (OQ) is this survey's primary metric for assessing expectations of local construction activity for the coming calendar year compared to the previous year. The OQ going into 2011 is a modestly positive 96. It is a marked improvement over the 2010 score of 66 and the all-time low score of 42 recorded for 2009. After wading through the recent recession, construction executives are somewhat more optimistic that local construction activity will improve over 2010 levels, according to survey results.
The industry demonstrates the depths from which it is rising, though, when asked more specifically about change in local work volume producing this optimism. Nearly half of respondents say that local nonresidential construction activity will remain at 2010's inevitably depressed levels, while 37% of respondents expect an increase in nonres activity. Overwhelmingly, 71% of respondents predict that local nonresidential activity will not improve until the second quarter of 2012 or later.
Fifty-five percent of respondents say that local residential construction activity will remain at 2010 levels, while 28% of anticipate an increase in home building. Seventy-seven percent of respondents do not anticipate a local housing-activity recovery until the second quarter of 2012 or beyond.
Each quarter Wells Fargo Equipment Finance, Inc. surveys construction industry executives to gather insight into current business conditions. The Q1-2011 survey was also made possible due to the cooperation and support of Associated Equipment Distributors (AED). These results represent the beginning of the bank's 35th year of surveying construction industry executives.