Based on the results of this year’s Top 40 Electrical Design Firms survey, 2017 was a year of slow but steady growth — with firms on the list bringing in a combined revenue total of $2.22 billion generated specifically from electrical design work. A 3.4% gain over last year’s grand total, the overall design revenue number has continued to rise slowly but surely over the last several years — from $1.68 billion in 2014 to $1.86 billion in 2015 to nearly $2.15 billion in 2016. However, although these numbers demonstrate a modest increase from year to year, revenue growth from the combined group in 2017 actually slowed — down 16% from last year and 28% from the year before. Despite decelerating growth rates for some of the key players, this year’s survey, as you’ll read in the cover story starting on page 26, reveals most companies are still experiencing good times (65% of respondents characterized the current business climate as “strong”), and most share an optimism for the future.
One area where optimism may be replaced with at least some level of trepidation is on the skilled labor shortage front. As has been the case for the last several years, top design firm executives admit one of their biggest ongoing struggles is recruiting and retaining skilled engineers and support staff for a growing volume of work. More than three-quarters of respondents say they are experiencing labor shortage issues and have trouble filling open positions. Following are just a few of respondents’ verbatim answers to the question: “What do you expect your greatest business challenge to be this year and why?”
• Retaining key staff members, particularly in our coastal urban offices, where high housing costs and market demand most impact our mid-level engineering talent.
• One of our greatest challenges is attracting and retaining high-caliber technical employees and engineers.
• Our greatest business challenge is likely to be recruitment, retention and training of talented engineers and staff.
• It’s always been hard to find great talent, but seems more prevalent an issue in today’s market as finding top-notch experienced employees is an issue.
• The recession resulted in a huge number of professional engineers leaving the building industry to pursue work in other sectors. This will be a long-term challenge as the next generation of engineering students is looking to high-tech companies as their future rather than the more traditional route of buildings. The problem is further compounded by the retirement of a large number of “boomer” generation engineers.
• We are still having a significant issue with finding skilled personnel in most all areas, such as project managers, supervising engineers, etc.
• Hiring and retaining qualified staff. Competitors are poaching staff with wages not commensurate to their experience.
As Freelance Writer Tom Zind reveals, many electrical design firms are confronting a perfect storm of retirements, turnover, and difficulty finding both younger prospects and experienced talent — all at a time when they need to add head count to keep up with demand. Read the cover story to find out what creative new ways companies are utilizing to facilitate knowledge transfer between veteran engineers and their younger counterparts and meet this problem head on.
