For many general contractors in California, 2008 may be seen as the last good year of revenue growth.
As California and the rest of the nation continue to weather the recession, contractors are anticipating that revenue growth for 2009 and the foreseeable future will decline. At the same time, competition for jobs is expected to increase as work dries up.
But contracting executives interviewed for this article say the news is not all dire. They view the recession as an opportunity to retrench and prepare for better times.
For Clark Construction, the sagging economy means expanding the company’s view, says Jim McLamb, vice president.
“[The recession] has nudged our group into looking in new arenas to build in, such as alternative energy,” McLamb says. “I think that’s a positive thing.”
At the same time, the recession also allows Clark to go back to basics, he adds.
“There is a rejuvenated and refocused effort on being good at what you do,” McLamb says.
Others are using the recession to invest in improving their companies for the future.
San Francisco-based Dome Construction is making a strong push to recruit technical staff for its biotech projects, says Mark Bley, CEO.
At the same time, Dome is installing $500,000 in construction management software, he says.
“When the market starts up again, we will be that much stronger,” Bley says.
The executives interviewed for this story reported that 2008 was a good revenue year for their companies. Three companies recorded revenue growth compared with 2007 while one contractor, Clark, recorded stable revenue growth.
However, all but one of the executives are predicting double-digit revenue declines for their companies in 2009 because of the recession.
One key challenge is financing for projects.
“We are finding fewer owners with the money or access to money,” Clark’s McLamb says.
The lack of financing has also led to changes in how contractors operate,...