The Associated General Contractors of California (AGC of California) recently conducted a membership survey revealing feelings of optimism among contractors toward the future of the construction industry. A positive outlook is apparent as respondents anticipate favorable financial performance and recruitment opportunities for their companies in 2024.
“The collective optimism of our members is the cornerstone driving the construction industry’s growth. It is their confidence that fuels innovation and attracts skilled talent essential to our ever-expanding workforce,” said Peter Tateishi, chief executive officer, AGC of California. “The survey serves as a barometer to gauge the optimism of our members within the industry. This insight guides us in offering tangible value through our comprehensive workforce development, robust advocacy, and leadership programs that foster inclusivity.”
Noteworthy insights from the AGC of California 2024 Optimism Survey highlight the following:
- Approximately 59% of survey respondents foresee growth or a moderate surge in business activities within California in 2024.
- More than 69% of those surveyed anticipate that the California construction sector will maintain its current pace or witness growth in expansion.
- About 67% of respondents felt optimistic regarding the overall state of California’s construction industry, greatly surpassing the 16.8% who shared a less favorable view. About 15% of respondents remained impartial, expressing a ‘neutral’ perspective.
- A strong 80% of respondents felt confident in the future success and potential of their own companies’ prospects in 2024.
To take advantage of upcoming market prospects, a multitude of companies are looking to bolster their workforce and enhance their bench of skilled professionals. Notably, 47.5% of those surveyed anticipate stepping up their recruitment efforts in 2024, with 26.7% planning a slight increase, 18% aiming for a moderate rise, and almost 2% preparing for a substantial upswing in hiring.
Regarding potential revenue gains, an optimistic 66% of companies predict that their revenue will experience an uptick in 2024 compared to the year prior — 7.6% foresee a significant boost, while 30.2% expect a moderate elevation, and 27.4% are looking forward to a slight increase in the coming year. Conversely, 20.6% of firms project revenue to plateau, and 14% anticipate a downturn.
When it comes to net profit expectations for 2024, about 61.3% of respondents are hopeful for an increase. Meanwhile, nearly 17% anticipate profits to stabilize without change, and 14.1% foresee a marginal decline.
“Despite a concern among the majority of respondents about the need for more skilled workers, a significant portion project that hiring will maintain its current pace or even rise in 2024,” Tateishi commented. “We are committed to leveraging the scope of our workforce development programs, which are crucial for equipping future employees with the skills needed in our critical industry.”
The worries surrounding California’s construction industry for the year 2024 notably revolve around a scarcity of skilled labor, with 73.7% expressing this concern. Stringent regulatory demands were cited by 64.2%, while the pressure to escalate wages and benefits was cited by 61.1% of respondents.
When prompted to identify their primary concern, workforce pipeline development rose to the forefront for 27.4% of those surveyed, with regulatory issues trailing closely as the second most significant concern for 25.3% of respondents while, 10.5% highlighted anxiety over a looming recession as their top worry.