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8/3/2019 Construction Survey Results
http://slidepdf.com/reader/full/construction-survey-results 1/16
8/3/2019 Construction Survey Results
http://slidepdf.com/reader/full/construction-survey-results 2/16
8/3/2019 Construction Survey Results
http://slidepdf.com/reader/full/construction-survey-results 3/16
8712 West Dodge Road, Ste 200 • Omaha, Nebraska 68114 • p 402.397.8822 • f 402.397.8649 • www.BlandCPA.com
Thank you or your participation in the 2010 Construction Industry Survey, sponsored by Bland & Associates,P.C. As promised, we have enclosed the results o the surveys received rom construction proessionals inthe Greater Omaha area and have made a donation to each o the ollowing scholarship unds: NationalAssociation o Women in Construction (NAWIC) Omaha Chapter 16, Construction Financial ManagementAssociation (CFMA) Nebraska Chapter and the Associated General Contractors o America (AGC) NebraskaChapter.
In its sixth year, the survey respondents again included a diverse group o contractors. Commercial, residentialand government construction services were all represented with annual revenues ranging rom $1 million to$150 million. We trust this inormation will be useul to you in making strategic business decisions or yourcompany.
In an eort to present the inormation in a manner that can be easily interpreted and utilized, we haveenclosed the ollowing:
1. Description o the survey respondents including contractor size and type.2. A summary o data or areas including operations and nancial management; human resources and risk
management; benets; compensation; and technology.3. Graphic representations o each question posed within the original survey.
We hope you nd this inormation valuable and we appreciate your participation in our survey. I you haveany questions regarding the inormation presented, please eel ree to contact me directly at (402) 397-8822or jvokt@blandcpa.com.
BLAND & ASSOCIATES, P.C.
Jeremy Vokt
Shareholder
8/3/2019 Construction Survey Results
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Today’s U.S. commercial construction industry accounts or approximately 80,000 rms and $550 billion in annual revenueaccording to national reports. The residential construction industry is comprised o 170,000 entities with $260 billion inannual revenue, compared to $465 billion last year. Government contractors, meanwhile, generate an estimated $300 billionannually on capital projects such as highways, bridges and public buildings. This gure has doubled rom $150 billion las
year.
The images below illustrate the 2010 survey respondent demographics. Similar to last year’s responses, the dominant companyprole in 2010 includes contractors operating in 2 – 5 states with annual revenues between $11 million and $50 million.In addition, over 41% o survey respondents reported they primarily provide general contracting services, an increase rom23.8% in 2009. Employee recruitment is currently the biggest challenge or just 4.2% o respondents, a signicant decreaserom 42.9% in 2009. The biggest challenge this year, according to respondents, is business development (41.7%).
Description o Survey Respondents
2
What is the biggest challengecurrently facing your business?
In how many states do you currently operate?
What does your company primarily provide? Annual sales
1 state
2 – 5 states
6 – 15 states
More than 15 states
No response
12.5%
62.5%0 2 4 6 8 10
No response
Other
State regulatory and tax climate
Seasonal work flow
Expanding foreign workforceEmployee retention
Employee recruitment
Business development
Bonding and insurance requirements
8.3%
4.2%
20.8%
4.2%
$1 – 10 million
$11 – 50 million
$51 – 150 million
Over $150 million
No response
8.3%
50.0%
41.7%
25.0%
In what categories do you classify your business?
0 5 10 15 20 25
No response
Government
Residential
Commerical 87.5%
79.2%
4.2%
0 2 4 6 8 10
No response
Other
Subcontracting
General contracting
Specialty trade service
0.0%
41.7%
4.2%
4.2%
0.0%0.0%
41.7%
20.8%
25.0%
29.1%
66.7%
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As previously indicated in national reports, and in our survey, cost controls and changing project needs oten make leasingequipment a much more cost eective solution, especially or smaller companies. Among this year’s survey respondents,however, 75% reported they own more than 75% o their equipment.
Receivables can be high or construction companies today, making cash fow management especially dicult. Industry reportreveal revenue is oten collected through periodic payments and is based on the completion o dierent project milestones,
which can be delayed by weather, supply issues and project problems. Some construction contracts also require retainageallowing clients to withhold payments until ater projects are complete. Less than 55% o the 2010 survey respondents reportedtheir receivables are out longer than 45 days, a drop rom 66.7% last year.
Operations and Financial Management
3
What is the average age of your receivables? What percentage of equipment
do you own versus lease?
What is your net income beforeowner's compensation?
What level of assurance is requiredfor your financial statements?
75.0%
4.2%
16.6%0 – 25%
26 – 50%
51 – 75%
76 – 100%
No response
30 – 45 days
46 – 60 days
61 – 90 days
More than 90 days
No response
How many months of revenueare typically in your backlog?
0 3 6 9 12 15
No response
N/A
Review
Compilation
Audit
0 – 2 months
3 – 6 months
7 – 12 months
More than 12 months
No response
20.8%25.0%
54.2%
4.2%
16.7%
58.2%
4.2%
12.5%
0 2 4 6 8 10 12
No response
More than 15%
11 – 15%
6 – 10%
0 – 5% 33.3%
0.0%
4.2%
41.7%
33.3%
20.8%
50.0%
16.7%
4.2%
4.2%
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According to national reports, a key challenge or construction companies today is hiring enough skilled workers who canaccurately estimate job costs. This is especially important as construction projects become more complex and or jobs withguaranteed maximum price contracts. The majority o 2010 survey respondents (50%) reported their estimates are within 1– 2% o actual job costs. More than 37% o respondents, however, said they overestimate projects by 3 – 5% on average, ajump rom just 19% in 2009.
Operations and Financial Management (cont.)
4
What percentage of gross revenues aregenerated using the following methods?
Not including change orders, on average, howclose are your estimates to actual job costs?
What percentage of your corporate grossrevenue is attributable to bonded projects?
What percentage of your corporate grossrevenue is attributable to change orders?
0
2
4
6
8
10 Overestimated
Underestimated
1 – 2%3 – 5%More than 5%
0 – 25%
26 – 50%
51 – 75%
76 – 100%
No response
0 – 5%
6 – 10%
11 – 20%
More than 20%
No response
4.2% 4.2%
29.2%
20.8%
12.5%
45.8%
41.7%
12.5%
37.5%
33.3%
16.7%
37.5%
4.2%
High Low Average
Not-to-exceed price 60.0% 5.0% 15.0%Fixed price 100.0% 10.0% 65.4%
Cost plus ee 90.0% 0.0% 28.2%
Times and materials 50.0% 2.0% 18.9%
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The majority o this year’s survey respondents reported their gross prot percentage is 20% or lower, with only 8.3% enjoyinggross prots o 31 – 40%. By comparison, 9.6% o the 2009 survey respondents reported a gross prot percentage o morethan 40%. More than 58% o this year’s respondents also indicated they have experienced decreasing prots over the pasve years.
According to the U.S. Census Bureau, commercial construction spending ell 15% in 2009 and is expected to drop another 3%
this year. The Bureau does project the industry to rebound steadily in the coming years, however, predicting a 4% spendinggrowth in 2011, 10% in 2012 and 12% in 2013. The 2010 survey revealed the top three new markets respondents areexpected to pursue include healthcare acilities (38.1%), educational acilities (33.3%) and oces (23.8%).
Customers and Marketing
5
What percentage of bids do you win?
What is your marketing budgetas a percentage of gross revenue?
What new markets will you bepursuing in the next five years?
What percentages of jobs are exposedto completion penalties or bonuses?
0 – 20%
21 – 40%
41 – 60%
More than 60%
No response
0 2 4 6 8 10
No response
Other
Transportation
Residential
Offices
Multi-family housing
Healthcare
Educational facilities
0 – 1%
2 – 5%
6 – 8%
More than 8%
No response
12.5%
16.7%
58.2%
16.7%
16.7%
25.0%
4.2%
20.8%
41.7%
4.2%
12.5%
45.8%
41.7%
What has been your gross profittrend for the past 5 years?
20.8%
20.8%
37.5%
4.2%
16.7%
0
5
10
15
20
25
Bonuses
Penalties
Noresponse
Morethan 60%
41 – 60%21 – 40%0 – 20%
62.5%
8.3%
100.0%
25.0%
0.0%0.0%
What is your actual gross profit percentage?
0 2 4 6 8 10
No response
More than 50%
41 – 50%
31 – 40%
21 – 30%
11 – 20%
0 – 10%
0 2 4 6 8 10
No response
Increase
Slight increase
Same
Slight decrease
Decrease
12.5%
41.7%
26.5%
0.0%
0.0%
0.0%
4.2%4.2%
8.3%
0.0%
4.2%8.3%
0.0% 0.0% 0.0%4.2%
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Industry reports reveal most contractors within the construction industry pay higher premiums or insurance, worker’scompensation and general liability. In addition, major issues currently acing contractors include construction delays anddeects, accidents by inexperienced or overworked employees, and poor bookkeeping. In this year’s survey, hal o therespondents reported a decrease o 1 – 10% in general liability costs. In 2009, however, the majority o respondents reportedan increase o 1 – 10%. The 2010 survey respondents also reported their biggest risk management challenges are currentlyworksite saety and contractual agreements.
Risk Management
6
How has your general liabilitycost changed in the past year?
What is your biggest risk management challenge?How much of an umbrella
excess liability do you carry?
How has your worker's compensationcost changed in the past year?
0 2 4 6 8 10
No response
Other
Contractural agreements
Cost of workman'scompensation limits
Worksite safety
0 2 4 6 8 10
No response
Increase more than 10%
Increase 1% – 10%
No change
Decrease 1% – 10%
Decrease more than 10%
0 2 4 6 8 10 12
No response
Increase more than 10%
Increase 1% – 10%
No change
Decrease 1% – 10%
Decrease more than 10%
0.0%
16.7%
8.3%
25.0%
16.7%
8.3%
0.0%
8.3%
12.5%
0.0%
16.7%
25.0%
0 2 4 6 8 10
No response
More than $10 million
$6 – 10 million
$3 – 5 million
$0 – 2 million
8.3%
16.7%
33.3%
0.0%
0.0%
41.7%
50.0%
37.5%
37.5%
37.5%
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According to the Bureau o Labor Statistics, employment growth in the commercial construction sector decreased 12% in2009, the rst drop since 2004. Residential contractors experienced an even larger decline o 23% in 2009, ater losing 12%o their workers in 2008 and 6% in 2007. Consistent with these reports, 41.7% o the 2010 survey respondents revealed theykeep more than 50 ull-time employees on sta, a decrease rom 57.1% last year. Survey respondents did note, however, thajobs are being subcontracted at a lower rate. More specically, more than 70% o this year’s respondents subcontract 20%or less o their projects, while only 47.6% subcontracted the same amount in 2009.
Human Resources
7
On average, how many full-timeemployees do you keep on staff?
What percentage of your full-time workforce is union or minority?
0
5
10
15
20
Minority
Union
Noresponse
Morethan 60%
41 – 60%21 – 40%0 – 20%
0 – 5
6 – 10
11 – 20
21 – 50
More than 50
No response
20.8%
79.2%
0.0%
75.0%
25.0%
41.6%
4.2%
12.5%
12.5%
What percentage of jobs are subcontracted?
0 – 20%
21 – 40%
41 – 60%
More than 60%
No response
16.7%
70.8%
12.5%
What percentage of your workforce will becomprised of minority workers in 3 to 5 years?
0 – 20%
21 – 40%
41 – 60%
More than 60%
No response
12.5%
66.7%
20.8%
0.0%0.0% 0.0%
29.2%
0.0%0.0%
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Benets
8
Due to the cyclical nature o demand or contractors, many construction companies keep only a core group o ull-timeemployees and hire additional workers on a project basis. As a result, there are no long-term ringe benets or those requiredemployees. Only 8.3% o the 2010 survey respondents oer benets to part-time employees, a decrease rom 14.3% last yearAmong the respondents who do oer benets to part-time employees, none o them oer disability or lie insurance coverage
The majority o survey respondents (87.5%) oer health insurance coverage to their ull-time sta, while just over hal o those
companies pay between 50% and 75% o their employees’ premiums. Only 23.5% o respondents pay the ull premiums oindividual coverage, a slight decrease rom 25% in 2009.
What benefits do you offer your part-time employees?
Pension plans offeredDo you combine vacation and sick days
into a "Paid Time Off" (PTO) system?
0 5 10 15 20 25
No response
None
Defined benefit
SIMPLE
Profit-sharing
401(k)
0 5 10 15 20 25
No response
Life insurance
Pension plans
Dental insurance
Long-term disability
Short-term disability
Health insurance
Yes
No
No response
0.0%
45.8% 54.2%
91.7%
4.2%
4.2%
0.0%
8.3%
4.2%
4.2%
8.3%
87.5%
Number of days received
Do you offer benefits to part-time employees?
Yes
No
No response
8.3%
91.7%
4.2%
4.2%
25.0%
Type o Day Experience Range Average
Paid Time OFirst Year 0 – 8 1
Ater First Year 0 – 18 3
Ater Fith Year 0 – 24 4
Vacation
First Year 0 – 7 1
Ater First Year 0 – 14 8
Ater Fith Year 0 – 21 12
Sick Time
First Year 0 – 10 1
Ater First Year 0 – 10 2
Ater Fith Year 0 – 10 2
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Benets (cont.)
9
Family percentagepaid by company
Individual percentagepaid by company
Family percentagepaid by company
Individual percentagepaid by company
Do you offer dental insurancecoverage to your employees?
0%
1 – 49%50 – 75%
76 – 99%
100%
0%
1 – 49%
50 – 75%
76 – 99%
100%
Yes
No
No response
0%
1 – 49%
50 – 75%
76 – 99%
100%
0%
1 – 49%
50 – 75%
76 – 99%
100%
54.2% 45.8%
52.9% 17.7%
12.5%
18.8%
37.4%
22.2%
66.7%
12.5%
62.5%
Long-term percentage
paid by company
Short-term percentage
paid by company
Percentage paidby company
Do you offer disability coverage
to your employees?
Do you offer life insurancecoverage to your employees?
Yes
No
No response
0%
1 – 49%
50 – 75%
76 – 99%
100%
0%
50%
100%
0%
100%
No response
0 5 10 15 20 25
No
Yes
Long-term
Short-term
37.5%
58.3%
62.5%
41.7%
45.8% 54.2%
13.3%
66.7%
70.0%
30.0%
45.5% 54.5%
Health plans offered
0 2 4 6 8 10
No response
Union provided
Traditional group health
Self-insured
High Deductible Health Plan (HDHP)
Health Savings Account (HSA)
Health Reimbursement Arrangement (HRA) 8.3%
12.5%
12.5%
41.7%
12.5%
37.5%
12.5%
5.9%
23.5%
18.8%
12.5%
25.0%
11.1%
20.0%
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Compensation
10
Industry reports show that jobs in non-residential construction oten require special training or experience and are relativelyhigh-paid. According to the Bureau o Labor Statistics, the average hourly wages or commercial workers rose to $25.13 in
January 2010, more than a two-dollar increase rom the end o 2008. Residential construction workers, meanwhile, earnedan average o $20.13 in January 2010, up rom $19.47 in 2008.
Contrary to industry reports, the average wages among this year’s survey respondents decreased overall, even though
workers’ experience increased. For instance, survey participants in 2010 are paying their project managers an averagehourly wage o $33.11, compared to $39.15 last year. The average experience o this position, however, increased rom11.4 years in 2009 to 14 years in 2010.
What is the basis for salaryincreases for your employees?
0 5 10 15 20
No response
Merit based
Cost of living
Automatic annual
7.1%
7.1%
14.3%
71.5%
Salary and Experience
Position Rate/Exp. Range Average 2009 Average
Project ManagerHourly rate $20.00 – $65.00 $33.11 $39.15
Years exp. 3 – 32 14.0 11.4
SuperintendentHourly rate $20.00 – $50.00 $31.78 $33.71
Years exp. 5 – 30 13.1 12.1
EstimatorHourly rate $18.24 – $67.00 $27.60 $35.58
Years exp. 3 – 30 10.8 8.9
ForemanHourly rate $15.00 – $35.00 $25.92 $27.05
Years exp. 3 – 22 11.7 9.9
Experienced
Laborer
Hourly rate $14.00 – $30.48 $19.06 $18.29
Years exp. 1 – 10 7.0 5.3
Entry-level LaborerHourly rate $8.00 – $18.00 $12.43 $11.60
Years exp. 0 – 4 1.3 1.3
Position Rate/Exp. Range Average 2009 Average
Ofce ManagerHourly rate $12.00 – $26.44 $21.31 $23.98
Years exp. 4 – 28 13.9 9.8
Sales StaHourly rate $15.00 – $60.10 $27.59 $30.92
Years exp. 3 – 25 9.0 11.3
ControllerHourly rate $15.00 – $50.28 $30.60 $37.98
Years exp. 5 – 30 13.8 15.4
BookkeeperHourly rate $12.00 – $27.00 $18.81 $16.68
Years exp. 5 – 20 11.0 8.5
Administrative StaHourly rate $9.00 – $24.04 $16.49 $18.53
Years exp. 0 – 20 6.0 5.5
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Technology
According to national reports, contractors who don’t invest in technology or use it eectively are at a serious disadvantageto the competition. This is primarily because technology enables construction companies to improve project implementationand reduce costs and mistakes, all o which are especially critical in an industry that relies so heavily on correct schedulingcoordination and technical specications. New construction sotware also aids personnel by enabling them to send updatesview up-to-date project completion and view cost inormation rom the eld.
Among this year’s survey participants, most use technology sotware or estimating and project management, while alrespondents use sotware or their nancial management needs. Microsot Excel is the most commonly used estimating sotwareand Timberline is the most popular method or project and nancial management.
What do you use software for?
0 5 10 15 20 25
No
Yes
Financial Management
Project Management
Estimating
87.5%
What estimating softwaredo you use?
What project managementsoftware do you use?
What financial management/accounting software do you use?
70.8%
12.5%
29.2%
Other includes: QuickBooks, Quick Bid,
FabTrol, WinEst, Custom
Other includes: CPM Constructware, Microsoft Access,
BuilderTrend, CustomOther includes: Sage Master Builder, Intuit Master Builder,
MAS 90, Maxwell, Custom
0 1 2 3 4 5 6 7 8
Other
QuickBooks
ComputerEase/ BusinessWorks
Timberline
0 1 2 3 4 5
Other
ComputerEase
Excel
Timberline
0 1 2 3 4 5 6 7 8
Other
Estimation/ Accubid
Excel
Timberline
27.8%
13.3%
27.8%
22.2%
38.9%
11.1%
33.3% 44.4%
11.1%
16.7%
26.7%
26.7%
100.0%
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Technology (cont.)
12
This year we asked survey respondents to rate various eatures o their sotware, including sophistication, ease o use, cost,stability and technical support. The tables below indicate the average ratings o respondents based on a scale o 1 to 10.Overall, the highest rated estimating sotware this year was Accubid, with a score o 8.0. Excel was the highest rated projecmanagement solution, while ComputerEase and QuickBooks tied or the highest rated nancial management sotware.
Top Estimating Software Used Top Project Management Software UsedRanked on a scale of 1 to 10 (10 being the highest) Ranked on a scale of 1 to 10 (10 being the highest)
Top Financial Management/Accounting Software UsedRanked on a scale of 1 to 10 (10 being the highest)
Timberline Excel Estimation Accubid
Sophistication 8.3 6.0 6.0 9.0
Ease o use 7.3 7.1 7.5 8.5
Cost 6.3 6.9 6.0 5.0
Stability 8.3 8.3 6.0 8.5
Technical support 7.5 6.3 3.5 9.0
Overall average 7.5 6.9 5.8 8.0
Timberline ComputerEase BusinessWorks QuickBooks
Sophistication 7.3 8.0 7.5 9.0
Ease o use 7.0 9.5 7.5 8.0
Cost 7.1 8.0 6.3 6.5
Stability 8.4 8.5 8.8 9.5
Technical support 7.6 8.5 7.5 9.5
Overall average 7.5 8.5 7.5 8.5
Timberline Excel ComputerEase
Sophistication 6.2 7.8 7.0
Ease o use 6.4 8.5 8.5
Cost 6.8 8.8 8.0
Stability 7.8 9.0 8.0
Technical support 7.0 8.5 8.5
Overall average 6.8 8.5 8.0
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8712 West Dodge Road Ste 200 Omaha Nebraska 68114 p 402 397 8822 f 402 397 8649 BlandCPA com
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