Deltek Releases the 43rd Annual Deltek Clarity Architecture & Engineering Industry Study

by Marcy Marro | 19 May 2022 12:00 am

Deltek[1] has unveiled the 43rd annual Deltek Clarity industry study results[2] for Architecture & Engineering firms. The results, based on a survey of nearly 550 A&E firms in the United States and Canada, identify the key challenges impacting the industry, as well as highlighting bright spots and forecasting future trends.

Produced in collaboration with ACEC[3], ACEC Canada[4], AIA[5], and SMPS[6], the Clarity study serves as a benchmarking tool to help firms understand the state of the A&E industry and provides detailed insight and analysis into technology trends, business development, financial statements, project management and human capital management.

The report revealed that closing the staffing and technology gaps will be required to deliver successful projects. Firms are very optimistic about pipelines and have strong backlogs, but rising labor costs are impacting financial performance. Firms must be more strategic about the projects they pursue while looking for opportunities to automate internal business processes through technology to reach aggressive growth goals and remain profitable. Key findings include:

• Firms optimistic about pipeline, but must be strategic about pursuits. Firms are very optimistic about revenue growth projections with growth forecasted at 17% compared to the previous year. This will require firms to be more strategic and purposeful in their project pursuits
• Closing the staffing gap by leveraging technology will be critical for project success. Addressing near-term labor challenges will require firms to invest strategically and purposefully. Firms can’t simply fill all positions overnight and while 43% of firms identified hiring more staff as one of their top initiatives, firms will also need to look for efficiencies through technology so they can deliver more projects with current staff.
• Firms must continue to leverage technology to reduce manual and time-intensive tasks. As companies struggle to address labor challenges in the short term, technology can help to improve efficiencies in every area of the business. Firms report that operations management and accounting & finance are still the most reliant on manual data entry and spreadsheets.
• Financial stability at risk with rising labor costs. While firms are reporting an average backlog of nearly nine months, overall financial performance was down, impacted primarily by rising labor costs. Most firms are looking to PM training and business process improvement to address financial challenges in the next three years.

“While the previous year presented many challenges for architecture and engineering firms, firms are very optimistic about the year ahead and are preparing for a more proactive and productive year. The Deltek Clarity report highlights the talent crisis that is impacting all areas of the business with increased employee turnover and the majority of firms citing more open positions than last year. In addition, respondents are dealing with a technology dichotomy: firms need to keep pace with tech trends and continue on their digital journey; however, lack of time may prove to be a top challenge in seeing that through. The major themes we saw in this year’s report are staffing challenges, the need for business process automation, managing a strong backlog and pipeline and leveraging technology to drive positive change,” said Megan Miller, Director of Product Marketing at Deltek.

The full results are now available here[7], or join the May 19 Deltek webinar[8] to learn more about this study.

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