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KPMG’s survey shows positive outlook for global construction industry

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November 1, 2013 by STAFF REPORT

The majority of companies in the global engineering and construction sectors are optimistic about growth across the industry, according to KPMG’s Global Construction Survey 2013: Ready for the Next Big Wave.

In Canada, the majority of respondents reported a backlog increase of more than 10 per cent stable profit margins in 2012 when compared to 2011. They also showed stability in 2013 volume of orders and anticipated/proposed margin rate when bidding in current tenders in 2012.

Overall, the survey found that more than 50 per cent of respondents from the Americas, Europe, the Middle East, Africa and Asia-Pacific regions said their companies experienced a backlog increase of at least five per cent from 2012 to 2013.

Although margins are not rising at the same rate as backlogs, 80 per cent of respondents said their margins will either remain stable or increase more than two per cent in the same period.

While the survey shows general optimism across the construction industry, there are still barriers to growth.

The industry is heavily reliant on national governments’ infrastructure plans for future growth, with two-thirds of respondents citing this as the single most important market driver. And risk management remains a challenge.

Heavy investments over the past decade are paying off, with the majority of respondents saying their risk management programs have improved project performance. However, 77 per cent claim underperforming projects are the result of project delays, poor estimating practices and failed risk management processes.

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