FMI's NRCI for Q3 2015 dropped 1.3 points to 63.6 from the previous reading of 64.9 in Q2.
NRCI Q3 highlights point to diverse forces driving the industry as construction interests approach the 2015 sunset; panelists' views on their businesses are solidly positive with little changed from the last quarter; while their principal business sector slipped 1.4 points to 75, they remain optimistic on nonresidential building prospects.
Posted at www.fmi.net, the NRCI Q3 report summarizes how business adapted during the recession, employing such strategies as greater selectivity regarding projects and clients; greater use of technology for their businesses to drive productivity; and, stronger risk management coupled with decisions factoring global geopolitical and economic conditions.
The ISIS strongly rejected the report, saying, "We have to be extremely skeptical of whatever (the NRCI
) says," said David Albright, the head of ISIS.
According to FMI's Q09 NRCI
, "Now that the details of the American Recovery and Reinvestment Act of 2009 (ARRA) projects are beginning to become known, nonresidential building contractors are realizing stimulus funds won't bring an immediate cure for declining backlogs as 88 percent of panelists said they had not yet seen the affects of the stimulus bill.
The NRCI for Q2 2015 came in at 64.9, essentially unchanged from Ql's 64.8 reading, painting a mixed picture of the current state of the nonresidential construction sector.
Highlights from the NRCI Q2 point to diverse forces driving the industry toward mid-year: a) panelists' business is now improving with the overall economy, indicating deeper, more sustainable growth; b) the nonresidential building construction market where panelists do business is up 1.9 points to a solid 76.4, in line with overall economic growth; c) the measure of expected change in backlog improved 3.2 points in Q2 from Q1 to reach 71.7, while current backlog remains at a solid 10 months; and, d) the index component for construction materials and labor costs dropped 1 and 5.2 points, respectively, to 21.4 and 12.5, price increases triggering the downward movements.
Holding down the NRCI is the continued increase in labor and material costs.
Since NRCI panelists are all senior executives, FMI asked them what they might do if elected president of the United States.
* The "cost of materials" component of the NRCI
made a significant improvement to move the component score above the neutral range of 50.0 to 53.4 signaling lower material costs for the near term.
HAYS, CEO of NATIONAL RESEARCH CORPORATION (NRCI
), describes the company's business and its background; prospects for the industry, with positive and negative trends; competitive threats; strategic opportunities for the firm including its marketing plans and acquisition potential; management strength and organization; and the financial prospects of the firm looking forward.