Logic dictates the construction industry boom region-wide will eventually subside, if not slip and slide to a harsh stop. After all, this is Florida: un-patented inventor of the boom-and-bust cycle.
But a singular focus on one metric — revenue growth in 2018 — shows the sector remains an economic force. For starters, combined revenue for all companies in this special section, the Top 50 contractors in the region, totaled $5.6 billion in 2018. That’s up 15.4% from the 2017 total, $4.85 billion. (To make the list, companies must be based in the Business Observer’s coverage area, from Polk County south to Collier County. Companies must be in some type of contracting field: electrical, general construction, roofing and more. Data is self-submitted.)
Of the 50 companies, 43 posted a sales gain, while five dropped and two stayed flat. Two companies, Naples-based Connor & Gaskins Unlimited and Fort Myers-based Advanced Roofing and Sheet Metal, doubled sales year-over, rising 115.7% and 110%, respectively.
Another revenue-based sign of the market’s prowess: Seven companies with at least $12.5 million in sales didn’t make the top 50. That’s an almost-there list with several established names, including Bradenton-based Key Glass, with $17.93 million; Fort Myers-based Lee Drywall, with $16.27 million; and Merit Electric, a Largo-based firm with $13.4 million in 2018 sales.
The strong market is visible in multiple sectors, says Mary Dougherty, executive director of the Gulf Coast Builders Exchange, one of the largest advocacy groups for the industry in the region. “I’m hearing good things from lots of members. They are doing well.”
Yet, going back to the boom-bust-boom cyclical nature of Florida, a yeah-but lingers. Dougherty, for example, reports one GCBX member told her his business has slowed so much, he probably can’t afford to renew his membership. That member says some subcontractors are struggling, too.
The other lurking issue for construction, of course, is the labor shortage. The Top 50 in 2018, combined, have some 11,700 employees — about 1,000 more than 2017.
But the labor shortage is a significant obstacle. For instance, 79% of Florida respondents to the Associated General Contractors of America 2019 Construction Outlook survey, report having a “hard time” filling some or all salaried and hourly craft positions. Nearly the same, 78% of Florida respondents, say it will continue to be hard or become harder to hire construction personnel in the next 12 months, states the survey.
The lack of labor, in turn, has a far reaching impact: at least 25% of AGC survey respondents say projects are costing more and taking longer to complete. That, combined with the potential for local governments to overreact if there’s a downturn, leaves Dougherty a bit worried, despite the overall market strength.
“I’m a little worked about what could be coming down the pike,” says Dougherty, adding she’s “cautiously optimistic,” that, if anything, a drop in business is a blip, not a trend. So do lots of contractors.
- Mark Gordon
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