Survey shows construction firms’ profitability has peaked

PSMJ Resources has announced the findings of its 2002 survey of the financial performance of architectural, engineering and construction firms in North America. The company, based in Newton, Massachusetts, specializes in producing management information and training for firms in the construction field.
Key findings of this year’s survey were:
 Operating profits as a percentage of net revenues fell nearly 7% from 2001. They were recorded as 13.16% in 2001, and as 12.27% in 2002.
 Gross revenues increased 6% versus an increase of 12% the year before.
 The cost of direct labour per hour rose to U.S. $23.95, representing a 5% rise.
 The backlog of work firms reported continues to rise, but at a lower rate than the last two years. The survey this year showed an increase of 6%.
 Firms’ net multiplier increased to a peak of 2.92.
 Staff growth rate is 3.2%, well below the peak of 5.6% in 2000.
 Utilization (chargeability) is 61.7%.
 Overhead rates increased to 150.8%.
 The full publication, entitled 2002 A/E Financial Performance Survey, 22nd Edition, analyzes financial results in more detail, including giving details on computer systems costs.
Visit www.psmj.com