Will Swearingen’s predictions for 2017…
1. Contrary to popular belief, healthcare costs to employers are going to go down. A plethora of options exist for companies looking to reduce their out-of-pocket healthcare related expenses. Firms on the bleeding edge will evaluate PBM arrangements, enter high performance networks and examine cost sharing plans.
2. Technology will continue to move at a blistering pace. We are only seeing the beginning of the IT trends that will define the way design and construction companies communicate for the next 100 years. If your firm is still faxing documents, you will need to take a good hard look at your 2017 IT budget and plan accordingly.
3. The information highway, will become a real highway. Smart cars and intelligent transportation systems will be an impetus for federal spending on infrastructure.
4. Education is going to take a hit. The education market has been a staple of many AEC firms diet for the last decade. Firms have gorged themselves on the opportunities that the education market has provided and will need to look to other market sectors to balance their 5-year plan.
5. Rates are going up. They have talked about it long enough. Interest rates have been in decline for the last decade. The fed will make a move to increase rates and this will impact the bottom line of AEC firms. It will become more expensive to borrow money to purchase equipment, fund growth opportunities and maintain positive cash flows.
6. Brace yourself and your firm for the 2018 recession. The trend has been steep and consistent. Since 2009 the Dow Jones Industrial Average has risen from just below 8,000 to almost 20,000. Economic cycles are similar to any well understood cycle. There are troughs, recoveries, growth phases, peaks and recessions. One could argue that we are at the top of the mountain folks. Keep an eye on your best talent, keep your costs in line and make sure you have enough cash on hand to support your firm in a time of need.