FMI’s CIRT Sentiment and Design Indices – Looking Back at 2024 and Growth Strategies for 2025
Published on by Eric Goodman in Construction
FMI, a leading consulting and investment banking firm for contractors, has partnered again with the Construction Industry Round Table (CIRT) to release their Q4 2024 Sentiment Index report offering insights and industry trends to close out the year. The report analyzed CIRT member responses collected in October related to the economy, industry trends, and other issues heading into 2025.
The full 16-page report is available on FMI’s website, but key takeaways include:
- The Sentiment Index increased from 62.6 to 64.1 and the Design Index increased from 66.3 to 71.1, both indicating modest recovery and optimism across the industry overall from both indices.
- The largest increases were related to the U.S. economy and local economies of respondents, while there were slight decreases in backlog levels and labor costs.
- On the design side, increased expectations of residential work were the biggest drivers, followed by healthcare, education, and consulting planning, offset some by decreased sentiment in heavy civil and transportation design.
- On the construction side, feelings on commercial, lodging, healthcare, and offices were up, while industrial, public works and manufacturing decreased.
- When asked about 2025 growth strategies, about half expected to grow organically, while only 8% were focused on growth through mergers and acquisitions, with about 40% utilizing multiple strategies.
- Firms focusing on organic growth in their existing operations and market segments are prioritizing hiring and retaining talent, as well as looking at strategic hires. Firms are confident their execution and ability to efficiently grow their capacity will be the keys to their successful organic growth.
- Firms looking to expand into new types of work or new geographic markets are looking for strategic hires and/or increased business development efforts to expedite their organic growth.
- 65% of respondents report utilizing AI tools, though only 30% noted workflow improvements and the other 70% indicated they weren’t sure or it was too soon to know.
Opportunities on the road ahead
Heading into the new year, the economy is still full of uncertainties, but there are still opportunities in the construction industry to act rather than react and stay on top of industry trends.
You might interested in our annual construction economic forecast with FMI – Thriving in an Evolving Landscape. Registration is open for in-person or virtual attendance here. (After the event, you can watch on-demand at the same link). Our 2024 Construction Compensation & Benefits Study looks at regional data from contractors of all sizes – it’s a great tool for planning and can help you build a competitive advantage in a tight labor market.
If you’d like to talk about how these trends may impact your construction business, or want to find a better, more efficient process or improve your bottom-line business results, contact us for a free consultation with one of our top construction industry pros. As always, we’re here to help.
