CHICAGO — A new year, a new outlook. CONTRACTOR interviewed industry professionals, from association and company presidents to marketing managers of manufacturing companies and construction industry consultants, and they all seem to predict that 2012 will be a bit better than 2011 — that there are positive industry trends occurring, making for a slightly improved business climate, yet certain areas of the country are having a rough time coming out of an economic downturn and the residential market is still slow to turn around.

Construction industry consultants FMI Corp., Raleigh, N.C., is forecasting a 3% increase in 2012 for construction put-in-place in 2006 dollars to show the effects of inflation. In current dollars it’s a nominal 6% increase.

“Our forecast calls for a 12% increase in residential construction for 2012,” FMI said in its Construction Forecast. “While that appears to be a strong recovery, consider housing is just starting to move off the bottom. The total represents stronger multifamily construction and home improvements as well as single-family housing; however, the total of $303.9 billion is equivalent to 1997 CPIP. In constant 2006 dollars, the gain is more like 9% for 2012.”

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On the commercial side, FMI data shows CII market sectors bottoming out in either 2010 or 2011 and beginning to increase in 2012. The two exceptions are religious buildings and public safety, both of which FMI is forecasting to bottom out in 2012 and resume growth in 2013.

Company forecasts

Anthony J. Guzzi, president and CEO of EMCOR Group, expects a slight upturn in 2012, in line with the latest FMI Construction Outlook.

“Absent our acquisitions, our backlog is up 30%,” Guzzi said, “but it had fallen in half from the peak to trough. So going back up is a good sign, although it’s not a broad-based recovery in commercial, and residential has to eventually come up.”

Given the uncertain economic climate, such as the Euro crisis that may destabilize the world economy, it’s difficult to forecast.

“We live in an economy right now that if we have a three- to six-month window, that’s as good as it gets,” Guzzi said.

Guzzi believes that the government should reform the tax code to make energy saving projects more attractive. Accelerated depreciation or tax credits could lower the payback period and increase the ROI for commercial/industrial/institutional energy projects. CII energy work would employ more people than residential, save more energy and expand the nation’s green footprint more quickly, he said.