Given the shaky U.S. economy and weak dollar, contractors servicing the slumping manufacturing sector are hoping overseas owners eyeing project opportunities on U.S. soil will come to the rescue. But some industry observers fear the level of foreign investment in the U.S. may not prove significant enough to fill the void left by traditional domestic clients.

Concerns about the market have escalated as manufacturing plant capacity rates published by the Federal Reserve have dipped. Many in the industry see a utilization rate of below 80% as an indication owners will likely cut back on expansions, says Mike Gearhart, president of CH2M-Hill’s manufacturing and life sciences group. Throughout 2007, the overall rate hovered around 79%. By June 2008, the plant utilization rate had dropped to 77.6%.