Does the Construction Industry Still Need Architectural and Engineering Services? (Part 3)

Charts 14 through 17 provide U.S. and Canada employment index comparisons for construction and architectural and engineering services, grounded first in January 2000, and then in July 2009.

2016-05-31-Does-Construction-Still-Need-Architectural-and-Engineering-Services-Part-5-Graphic(Continued from “Does the Construction Industry Still Need Architectural and Engineering Services? (Part 2)“.)

Over the longer time frame, January 2000 to the present, Canada has had an obvious advantage in both construction and design services employment, although there has been slippage in the latter of late.

During the shorter time frame, July 2009 to the most current month, the U.S. has been catching up with Canada and convergence is near at hand.

 
 

Chart 14: Indices of U.S. and Canadian Construction Employment: January 2000 = 100.0

Chart 14: Indices of U.S. and Canadian Construction Employment: January 2000 = 100.0

Data source: U.S. Bureau of Labor Statistics (BLS) and Statistics Canada / Chart: ConstructConnect.

Chart 15: Indices of U.S. and Canadian Architectural and Engineering Services Employment: January 2000 = 100.0

Chart 15: Indices of U.S. and Canadian Architectural and Engineering Services Employment: January 2000 = 100.0

The Canada architectural and engineering series is based on moving 12-month averages placed in the seventh month.

Data source: U.S. Bureau of Labor Statistics (BLS) and Statistics Canada / Chart: ConstructConnect.

Chart 16: Indices of U.S. and Canadian Construction Employment: July 2009 = 100.0

Chart Chart 16: Indices of U.S. and Canadian Construction Employment: July 2009 = 100.0

Data source: U.S. Bureau of Labor Statistics (BLS) and Statistics Canada / Chart: ConstructConnect.

Chart 17: Indices of U.S. and Canadian Architectural and Engineering Services Employment: July 2009 = 100.0

Chart 17: Indices of U.S. and Canadian Architectural and Engineering Services Employment: July 2009 = 100.0

The Canada architectural and engineering series is based on moving 12-month averages placed in the seventh month.

Data source: U.S. Bureau of Labor Statistics (BLS) and Statistics Canada / Chart: ConstructConnect.

U.S. Earnings in Architectural and Engineering Services

This article ends with subject matter dear to the hearts of many of us, the number after the dollar sign that appears on our pay checks. Charts 18 and 19 set out earnings in the design services sector.

Chart 18: U.S. Architectural and Engineering Services
Year-over-year Average Hourly Earnings

Chart 18: U.S. Architectural and Engineering Services Year-over-year Average Hourly Earnings

Data source: Bureau of Labor Statistics (BLS) / Chart: ConstructConnect.

Chart 19: U.S. Architectural and Engineering Services
Year-over-year Average Weekly Earnings

Chart 19: U.S. Architectural and Engineering Services Year-over-year Average Weekly Earnings

Data source: Bureau of Labor Statistics (BLS) / Chart: ConstructConnect.

Both graphs show, that in the architectural and engineering services sector, as was also the case in most pockets of the economy, some big year-over-year jumps in hourly and weekly compensation in 2007 and 2008 crashed into the wall of the Great Recession.

While subsequently regaining some of their earlier sprightliness, they have mainly remained locked in the +1.5% to +2.0% range, or lower.

Increases in weekly (i.e., as opposed to hourly) earnings, of late, have been especially limp.

By and large, the same can be said for almost all employment categories throughout the broader economy. Average hourly earnings for all employees in the design services sector are currently +1.5% year over year, according to the BLS. Unfortunately, that is slower than for all workers in the private sector, +2.3%, and for employees earning a living in construction, +2.2%.

As for weekly earnings, the gap is larger, with employees in design services earning +0.5% more than last year, but all workers pulling ahead by +2.0% and construction’s dependents, +1.5%.

Workers in architectural and engineering services can take comfort, though, in the fact their compensation levels are considerably higher than for almost every other industrial category.

Their current average hourly rate of $37.73 is well above both the all-jobs figure of $25.43 and construction’s $27.85.

The same favorable pattern appears for weekly compensation, with architectural and engineering services chalking up an average figure of $1,467.70 compared with the economy-wide’s level of $874.79 and construction’s $1,077.80.

Conclusion

In Canada, where commodity markets play an outsized role in the economy, the design sector is currently facing somewhat of a hiatus in which work opportunities, especially for young people entering the profession, have become more restricted for a while. What’s needed will be improved global trade to boost demand and prices for raw materials, plus the impending helpful shock of public sector spending on productivity-enhancing infrastructure projects.

In the U.S., the rebound for architectural and engineering firms is largely complete and the industry is on the cusp of considerably better prospects. But there is a caution. It’s no longer the same old construction world. There is a need to be wary on account of technological innovations throughout society at large that are limiting new square footage requirements.

And don’t underestimate the degree of change that is underway in the field of new building product introductions mainly directed towards preserving and improving the environment. Design professionals, always known for staying up to date, must be ever more vigilant as the important and broad-reaching quest for sustainability transitions fully into the mainstream.

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