34th Annual MA Architects Survey

Our 33rd annual survey of architects reflects that as most overall construction numbers increased in 2018, and even those specific to metal construction—metal roofing, metal walls, metal building systems, etc.—also went up.

Just in December, the construction industry created 100,000 new job openings, and the ratio between unemployment and job opening rates in the industry is 1.32. In other words, for every unemployed worker in construction, there are 1.32 job openings.

The lack of skilled workers does not affect architects directly, but it does mean that general contractors and trade contractors are being more careful about the work they take on, and probably bidding work at higher costs. (That said, wage growth in the U.S. economy still has not grown as steeply as economists have feared, especially at the lower end of the wage pool, and inflation has been kept in check.)

The industry is in a strong position going into 2019. That is in spite of fears over the affect the steel and aluminum tariffs would have on both rising costs and building product material availability. Both concerns may have been overblown. Our report in April 2018 revealed that many economists in the construction industry were worried that the tariffs would cause the contraction of the industry to come a little sooner.

The 2019 Dodge Construction Outlook from Dodge Data & Analytics, New York City, predicts U.S. nonresidential construction will match its 3 percent increase from 2018 in 2019 in spite of a decrease in commercial construction of about 3 percent. Offsetting those declines will be gains in institutional, industrial and manufacturing.

According to the National Association of Home Builders (NAHB), single-family starts will increase 4.7 percent to 927,000 starts in 2019. By 2020, starts will increase to an annual rate of 979,000. However, the good news in the single-family market is offset by a cooling in the multifamily. After a rise of 7.6 percent in 2018, topping at 356,000 starts, there will be a downturn over the next two years. NAHB predicts a 4.4 percent decline in 2019 and another 0.5 percent decline in 2010.

The residential home improvement market has been on a tear for the last several years, clocking in at over 5 percent annual increases and topping at nearly 7.5 percent increases in the last several quarters. The Joint Center for Housing Studies at Harvard University forecasts a slowing in the increase of activity. After hitting 7.5 percent growth in 2018, the Leading Indicator of Remodeling Activity shows a slowing to 5.1 percent growth. That still represents more than $350 billion in remodeling activity.

The Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University publishes an annual Leading Indicator of Remodeling Activity (LIRA). Historically, the remodeling industry has grown at about 5% annually, but the LIRA report for 2020 shows a modest 2% growth. That will edge the total market above $330 billion in 2020.

General Statistics

In 2020, the respondents to our annual architects survey very closely match the breakdown of last year’s survey takers. Nationally, 58.8% of respondents indicated they worked for an architecture firm, which is nearly statistically identical to last year’s 58.2%. And, like last year, the second highest cohort, design-build firms, also was nearly identical to last years with 17.6% in 2020 and 17.4% in 2019. Beyond those two types of firms, which account for more than three quarters of all respondents, the next two types, architectural/engineering and integrated construction, comprise nearly 20% of the total.

That consistency transferred also to the positions held by the people responding. In 2019, just over 70% of respondents were owners or partners in the firm, and this year, slightly less than 70% identified as holding that position. The next largest group of respondents reporting this year was staff architects, who represented 8.9% of the total. One major change from 2019 was in two categories, exterior designer and specification writer. This year, we had no respondents in those categories, so they have been removed from this year’s reporting.

In a growing construction economy, it’s no surprise to see robust reporting on firm growth, but the growth picture is more complicated than that. More than 11% of firms saw growth greater than 50% in 2019 compared to 2018. That’s a huge number compared to last year’s 1.7%. But the total respondents who said their billings increased in 2019 was 61.1%, which is significantly less than the 78.9% of last year’s respondent who reported growth.

One could suppose that having such a large number of firms reporting growth greater than 50% would indicate that we had a higher percentage of small firms this year. But, as with the company type, the breakdown of firm size, as measured by billings, was approximately the same. Smallest firms, less than $1 million in billings, comprised 54.9% of respondents, compared to 51.8% last year. We did have a noticeable decrease among firms with more than $10 million in billings. Only 5.7% participated this year, compared to 13.4% last year.

Metal Roofing

In 2019, our respondents say about 29.7% of the new construction projects they worked on included metal roofing. That was a 6.8% increase from the previous year. For the most part, that growth story held true regardless of the region of the country, although the East (which had fewer companies reporting involvement) showed greater growth year over year. On renovation projects, 17.6% of respondents reported using metal roof panels in 2019, and say that was an 18.2% increase over 2018. There were much wilder swings from region to region in terms of growth with companies in the West actually reporting a 3.2% decline, but the large variances can be attributed as much to the percentage of firms reporting from that region. One firm with a large increase in the number of projects that include metal roofing can sway the overall results.

Looking to 2020, about 95% of respondents anticipate specifying more or about the same amount of metal roofing compared to 2019. Those projects include both new construction and renovation work. Companies in the South and West indicate they are more likely to increase the specification of metal roofing this year than the other two regions.

Interestingly, a higher percentage of firms reported specifying batten seam metal roofing (43%) than either low-slope (37.6%) or steep-slope (26.9%) standing seam metal roofing (SSR). Does this mean that batten seam metal roofing is trending upward in design circles? That’s one possible explanation. Another may be that this year’s respondents had an unusual number of such projects and the uptick is an anomaly. It will be an important question to look at in the 2021 survey. While low-slope SSR saw a decline this year, the other types of roofing specified broke out similarly to last year’s survey with two minor exceptions. Insulated metal panel (IMP) roofs were specified by 36.6% of firms in this year’s survey compared to 31.3% last year, which may indicate an increasing acceptance within the design community for IMPs. Again, next year’s survey will be a better indicator of the validity of this trend. The other type of panels where we saw an increase was stone-coated panels. We don’t ask how much our respondents are engaged in residential versus commercial work, but the increase in stone-coated panels may indicate that we had a higher number of firms doing residential work than last year.

Metal Wall Panels

Among our respondents this year, the percentage of those new construction projects where they specified metal wall panels increased significantly over the survey takers in 2019. Last year, respondents specified metal wall panels in only 27.4% of new construction projects. This year, that number jumped to 42.1% of projects that included metal wall panels. On the renovation side, however, the percentage remained roughly the same at about 16%.

Our survey takers say that the percentage of new construction projects for which they specified metal wall panels increased 4.9% from 2018 to 2019. In the West, it was roughly the same, but the other regions reported increases, with the Midwest reporting the greatest at 14.2%.

Among renovation projects, our respondents increased the number of projects where they specified metal wall panels 14.2% from 2018 to 2019. Looking forward, just under 95% of respondents say they will specify more metal walls panels or about the same in 2020.

Nearly every product type showed a decline in specification from last year’s respondents to this year. Concealed fastener dropped from 60.3% of firms specifying to 57%. Corrugated from 51%

to 45.6%. The survey shows similar declines across the board. That doesn’t indicate companies were less likely to specify metal wall panels. In fact, we know respondents this year were far more likely to specify metal walls. What is different, though, is they were more likely to specify a wider variety. Instead of concentrating on exposed fastener panels or foam-core panels, they took advantage of the full variety of panels.

Metal Buildings and Metal Framing Systems

The metal building systems category staged a bit of a comeback in this year’s survey. Respondents report specifying a pre-engineered metal building for 31.1% of their new construction projects in the previous year. Last year, such systems were specified in only 20.6% of projects. Another indicator of greater acceptance of metal building systems among our survey takers this year is that they increased the number of projects they specified 11.2% from 2018 to 2019.

Matching the pattern established in metal roofing and metal wall panel specification, renovation projects involving metal building systems held about steady from last year’s survey with respondents reporting specifying a metal building system for 16.8% of renovation projects in 2019. That was about an 18% increase over the number of projects in 2018 for which they identified metal building systems.

Twenty-five percent of respondents say they will specify more metal building systems in 2020, with only 4.5% saying fewer projects will include metal building systems. We also ask about the likelihood of specifying metal framing systems in our survey. Among respondents, 29.1% anticipate using more metal framing systems in 2020, with just 4.7% expecting a decrease.

Green Technologies

Every year, we survey architects on green technologies, looking at using metal for LEED points, cool metal roofing systems and solar collector products. Year after year there is very little change in the percentage of respondents indicating they specified such products.

Looking at metal projects used to achieve LEED designation, we see a trend line of the very slightest gradual decline over the years. There was some volatility about the time LEED v4 came into the picture, but since then, firms are no more or less likely to specify metal products to get LEED points.

The same steadiness showed the specification of cool metal coatings. In fact, there is no decline or increase to speak of. The trend line stays flat and steady, indicating cool metal roofing has achieved a certain level of acceptance and is unlikely to change unless something significant in the marketplace occurs.

The green technology that has seen the greatest change is with solar panels, photovoltaics and solar films. The true story, though, is more nuanced. After a rapid increase in specification between 2013 and 2015, respondents indicated they were decreasingly likely to specify solar technologies. But the respondents this year, survey takers reported that they were far more likely to specify solar technologies (42.4%) than in any previous year. In fact, the year-over-year increase from 2018 to 2019 was 51.8%. No other year has seen such a significant change, either increase or decrease. And over 30% of respondents expect to use solar technologies even more in 2020.