How Infrastructure will Fuel the Economic Recovery

A hopeful source of work for civil engineers in 2011 will be the rail and transportation sector. This sector has seen the recent distribution of $8 billion in ARRA funds to begin development of 13 new, large-scale high-speed rail corridors across the country. The major corridors are part of a total of 31 states receiving investments, including smaller projects and planning work that is expected to help lay the groundwork for future high-speed intercity rail service. Earlier last year President Obama proposed $1.82 billion in funding in his fiscal year (FY) 2011 budget for 27 major transit construction projects. The budget recommends investing $834.6 million in 19 new transit construction projects — 10 of which are new funding recommendations in FY 2011, and nine of which have been recommended for funding in previous years. The plan also provides $924.6 million for the continued funding of eight projects already under construction in New York, Dallas, Denver, Salt Lake City, Seattle, and Northern Virginia.

More than half of survey respondents said that alternative energy markets, including wind and geothermal, have great growth potential for civil engineering services. In 2009, with assistance from the ARRA, the U.S. wind industry installed a record 10,000 megawatts (MW) of new generating capacity, according to the American Wind Energy Association (AWEA). With these new projects, wind power now ties natural gas as the leading source of new electricity generation in the United States, AWEA said.

But executives in the renewable energy sector warn that such gains may be short lived without a national renewable energy standard (RES). "The RES is the best way to provide the certainty that companies need to expand wind manufacturing nationwide,” said the AWEA. The Geothermal Energy Association added that Congress had enacted stimulus legislation with a historic group of incentives supporting geothermal and other renewable technologies. The keys to sustain this growth will be adopting longer-term measures to support an increase in both new projects and the manufacturing and supply infrastructure.

The promise of emerging markets only offers hope to those civil engineering professionals who can endure the current challenges. By a wide margin survey respondents ranked maintaining a backlog as the greatest challenge facing their firms this year and early next year. In fact, more respondents ranked maintaining a backlog and maintaining clients as the greatest challenges. This is made more difficult when almost 90 percent of respondents’ firms have experienced projects going “on hold” during the last six months.


It should be very clear that last year’s optimism for recovery in 2010 was premature. Nevertheless, expectations for increasing firm revenue and indications of continued federal support for transportation and renewable energy markets offer hope today that, for the civil engineering industry, the recession has bottomed out and a recovery — however slow — is potentially within sight.
The lack of work is particularly telling in the growing number of firms that experienced layoffs or downsizing events during the last six months — almost 60 percent of respondents’ firms in 2010 compared with over 40 percent in 2009. It is not surprising, therefore, that only 8 percent of respondents this year said that maintaining staff was a challenge, compared with 16 percent of respondents a year ago. Likewise, only 61 percent of respondents in 2010 regarded recruiting and retaining talented civil engineers as an important issue to the industry, compared with 77 percent of respondents in 2009. And in the face of less work and shrinking staff, maintaining staff salaries has become a greater challenge early this year, almost double the number in 2010.

The A/E/C Sector: Where has it been and where is it going?

Shortly after President Obama signed the American Recovery and Reinvestment Act (ARRA) in February 2009 several surveys taken by industry magazines found more than half of the civil engineers taking the survey expressed dissatisfaction with the way things were going at their companies or organizations and the industry in general.  Now, one year later — and billions of dollars of recovery spending later — a slightly greater proportion of survey respondents said that they are still very dissatisfied with the status of the engineering, architecture and construction markets.  The respondents pointed at the current administration as the primary cause of this lull in the construction sector.

Has the ARRA made any difference for civil engineers?  In a recent report, the American Association of State Highway and Transportation Officials (AASHTO) touted a list of projects that were completed during the last year because of ARRA (stimulus) funding.  However, since many, if not most, of these projects were “shovel ready” — already designed — civil engineering firms have not likely been impacted as positively as contractors, although some firms received construction management contracts resulting from initial ARRA funding.  Nevertheless, funding for public and infrastructure projects and for private projects still remain the two most important issues to the civil engineering industry.

It appears that the impact of the stimulus is clearly being overshadowed by the sweeping downturn in overall construction demand.  U.S. Census Bureau figures show that private non-residential spending dropped 18 percent in December 2009 compared with December 2008.  Only power construction has increased from year-ago levels, by 14 percent.  In contrast, publicly funded construction increased by 1.0 percent between December 2008 and December 2009.  Stimulus spending helped boost highway and street construction by 3.7 percent, making it the largest public category.  According to IHS Global Insight, an economic and financial information research firm, total construction spending will continue its decline, decreasing 5.6 percent in 2010 before growing 7.6 percent in 2011 and achieving double-digit growth in 2012.

Civil engineers responding to the current surveys also anticipate continued declines the remainder of this year and for early 2011.  In 2009, roughly two-thirds of respondents expected the AEC industry to shrink or remain the same during the year.  This year more than 80 percent of respondents anticipate that the AEC industry will not grow appreciably during the next year.  Nevertheless, slightly more than 20 percent of survey respondents optimistically forecast that their firms’ total revenue for engineering services will increase in the next year compared with last year.  A year ago, less than 10 percent of respondents anticipated increased revenue.  Significantly fewer respondents expect decreased revenue this year.

If civil engineering firms in particular are able to increase revenue in 2011, it will likely be on the back of traditional infrastructure markets — transportation and water — with help from the quickly emerging alternative energy sector.

According to the American Road and Transportation Builders Association (ARTBA), record federal investment in surface transportation, increased spending through the ARRA, and continued easing in material prices will increase the highway construction market in 2011.  However, uncertainty over the reauthorization of a multi-year federal surface transportation bill and future growth of the overall U.S. economy, along with the end of stimulus funds, will determine if there is a “soft landing” in 2011 or a more significant downturn.

Another indicator of work to come is the high level of obligations for ARRA funding — more than 77 percent of stimulus funds have been obligated, but only 16 percent of the total funding available actually has been paid to contractors.

Read the next blog to see how Infrastructure will Fuel the Economic Recovery.

Some Advice for Experienced Engineers in this Down Market_ Part II

Our previous post discussed the general business situation and its impact on management level and higher engineers.

This second part will continue to provide suggestions in your job search and conclude with some insights into breaking the current “experienced engineer” barrier.  Other recommendations include:

• Check out the Army Corps of Engineers and other military related sites, as regardless of the economic conditions they have needs for personnel that have well rounded careers, particularly in the field of civil engineering.  Different types of experience can be a plus in this sector and “not so recent” experience is better received at these agencies.

• Update your resume frequently, at least every three months.  A cover letter dated three months ago says that you are getting discouraged and are just sending out “whatever resume(s) you have” on file.  Current dates and specific job experience descriptions are key to getting an interview.  Tailor your cover letter to specific positions that you are most attracted to.  Remember that the first and primary goal of a resume is to get an interview.  When you get that interview your resume has done everything it has supposed to do, so reward yourself when these successes occur.

• For those with diverse experience, create two or three cover letters/resumes that are specific to these sectors.  It will take only 10-15 minutes to tailor your general resume toward these areas of project experience and qualifications, and these resumes will always have a better chance of landing an interview.

• Try to focus on more recent employers and projects in your resumes.  Employers are looking for middle aged project managers more than experienced project managers who are looking at five to ten years of service left before retirement.  I am not saying to falsify your resume, but jobs before state registration do not need to be referred to for the most part.  They date you and could contribute to your resume being “filed” a lot quicker than those with more years of service left.  I will talk a bit more about this later.

• Keep good records of your job search.  A good method of tracking your work is the ENR lists of employers in your area.  When you apply electronically or by FAX or mail place notes beside the firm’s listing recording the date of electronic or hard copy submission.  Also, if you have different resumes for different sectors note what resume was used in the application.  This could avoid some embarrassing discrepancies in the interview process should you be selected for interview.

• Keep open to other professional opportunities, particularly the construction side of engineering.  I have found that broad based or extensive project experience is respected more at construction firms than pure engineering firms.  Many times the right or wrong thing to do in the field is better determined by past experience, rather than courses at the Masters Degree level by more recent graduates.  Engineering theory many times will take a back seat to practicality and cost of a specific field solution.

• Most importantly, do not get discouraged.  You need to stay in the hunt as the employment market improves (hopefully).  As you continue to apply online and otherwise, be consistent with your computer ID and password.  Most sites have saved your resume information from a previous submittal and a new application for a position could take seconds instead of a half hour or so repeatedly filling out basic resume fields.

Finally, you must take into consideration what engineering firms are actually using as criteria for candidate selection.  In this area I have mentioned that age and experience sometimes can be a bigger “roadblock” than “highway” to hiring.

A recruiter I know mentioned recently that larger firms, particularly those in the top 100, would rather make an investment in “35-something” year old engineers with 10+ years of experience.  So if you fit in this category you should feel better about your job search and your chances of success.  The larger firms are frequently looking at the remaining years of service a candidate represents.  As I said previously, 20-25 years of career left looks much better than 5-10 years of service left.  Salary and benefits are big ticket items too, sometimes overriding qualifications and experience.  Plus, in many cases these firms conclude that the “35-something” engineer has made all of his or her “learning mistakes” and is ready to do the best work of their career.  Also the younger candidate is somewhat “closer” to current design methodologies, particularly in structural engineering (such as allowable stress design versus strength design with factored loads).

So what can you do to break through this invisible barrier?  Consolidate your experience on the resume to the fullest extent while not falsifying your background.  As I said before, forget experience before your PE.  Also, try not to date yourself by indicating what year you graduated from undergrad or grad school.  A lot of times you cannot do this as the electronic forms on job application sites have “asterisked” entries that require a response or the form does not get submitted.  In no way consider falsifying any information on your resume because if discovered could result in your being reprimanded or worse, terminated.

I hope that this post will shed some light and provide suggestions on experienced job searching in the current design/construction environment.  Also, I hope that it will provide encouragement to the many thousands of productive, highly capable and valuable engineers in the last phases of their career.        

Some Advice for Experienced Engineers in this Down Market- Part I

The demand for experienced engineers is at an extremely (some say historically) low level, particularly in California and along the West Coast.  The mere quantity of job seekers is unprecedented when compared to the open positions.  In this market firms are looking for very specific experience including recent, relevant local projects and client contacts in the City or County where they are based.  For job seeking engineers outside of that City or State the situation is even worse as firms will only pay relocation for those individuals that fully meet or exceed the experience and qualifications required for the job.

For example, an experienced engineer has significant transit experience on his/ her resume but this work was performed 5 to 10 years ago.  For the most part, hiring firms do not consider that “recent, relevant” experience when evaluating a candidate.  This can be expected when so many are on the job hunt with so few open positions.  The hiring firms can afford to be “picky”.  Of course, if things turn around in the next couple years this will change gradually, but for those facing financial hardships because of the loss of their job time is definitely not in their favor.

Here are some suggestions for experienced engineers faced with this career dilemma:

• In addition to the traditional Monster, Career Builder and other job forums take a look at Craig’s List in your local area.  Smaller firms that are busy but cannot spend the money to advertise on these expensive sites usually use Craig’s List as a cost effective way to announce their open positions.

• Keep your primary focus on local openings, your recent experience is here and you have the best chance of landing a job near home.  Relocation is expensive (regardless of who pays for it) and time consuming.

• Try alternate web job boards like www.Indeed.com that are a good search engine for open positions that match your job title and locality.  There are numerous others but I have heard much more about Indeed than other similar websites.

• Apply directly to company web sites whenever possible, this way the potential employer is looking at the minimum monetary and time “investment” necessary in identifying qualified local candidates.

• If you have a particular employment sector in mind take a look at the recent Engineering News Record (ENR) top 100, 250 or 500 firms and identify which of these firms has a local office.  Start at the largest or busiest and work your way down.  It provides regimentation and structure to your job search and at least gives you the feeling of accomplishment that you have identified all larger firms in your area that could be hiring.  Usually the largest firms with many regional office have ways of spreading their workload and experienced marketing groups doing their best to find work and compete for work.

• Don’t be limited to private firms, check your local DOT, city, county or state job listings regardless of what you have heard about their current hiring needs.  Check out your local Public Utility Commission or water departments as they tend to have openings due to retirements or people advancing within their agencies.

Our next post will continue to provide suggestions in your job search and conclude with some insights into breaking the current “experienced engineer” barrier.

Paul LaCiura PE

Welcome to the LaCiura Consultants Blog

Nahid and I started this blog to keep you informed on the latest news, commentary and technical issues in the fields of civil engineering and surveying. 

We will be posting articles of interest on a regular basis so please visit our blog frequently and feel free to leave comments or questions. 

To find out more about us and our company please visit http://www.laciuraconsultants.com/ or find us on Facebook and LinkedIn.

Thanks,


Nahid and Paul