FMI released its Second Quarter Nonresidential Construction Index (NRCI) for 2012. Rising 1.7 points from the first quarter, this is the highest confidence rating ever achieved since the index was developed in 2007.
Panelists reveal that backlogs remain about the same at a median of eight months. However, all markets, with the exception of education construction, are expected to improve slightly over the next quarter. Productivity has also shown improvement. Holding down the NRCI is the continued increase in labor and material costs.
With U.S. elections and global economics dominating the headlines this year, FMI asked panelists to identify what issues may affect their business strategies. Topping the list of global issues are rising inflation as the result of U.S. monetary policy and the collapse of the European Union. Although debt default in Greece and Spain are important, they ranked considerably lower on the list of concerns.
Topping the list of election-year issues are the need to reduce spending on entitlement programs and to reduce the national debt. Since NRCI panelists are all senior executives, FMI asked them what they might do if elected president of the United States. The most mentioned action items include:
- Tax reform.
- Balanced budget.
- Cost cutting.
- Entitlement reform.
- Collaboration rather than confrontation.