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High Expectations for 2024: Expectations for positive business performance in 2024 are higher across all seven industry groups compared with expectations for 2023; 61% to 71% of firms are predicting a good or very good performance in 2024 versus 50% to 56% in 2023. Interior designers are the most optimistic, with more than 70% expecting a good or very good year, followed by design-build firms and general contractors (66% and 65%, respectively). In contrast, building and renovation firms are the least optimistic, with 61% expecting the same.
Increased Demand for Services Expected: More than half of businesses (54% to 62%) across the industry groups anticipate a higher demand for their services. The shares are more than double the shares (21% to 32%) of those expecting more demand at the beginning of 2023.
Revenue Growth Estimates Rebound: Businesses across all seven industry groups expect an increase in revenue and profits in 2024, following a challenging 2023 environment. Interior designers and architects have returned to more typical revenue growth expectations in 2024 (8.9% and 5.3%, respectively), in contrast to their cautious forecast for 2023 (3% and 0.3%, respectively). Among construction professionals, building and renovation specialists have the highest anticipated revenue growth, followed by general contractors, remodelers and builders, and design-build firms (8.1%, 7.7% and 3.3%, respectively).
Decreased Labor Availability and Rising Labor Costs: Six of the 7 industry groups predict that labor shortages will continue in 2024. Expectations for rising labor costs in 2024 also are prevalent across the industry, with more firms (38% to 58%) planning for higher costs compared with the previous year (24% to 35%).
Better Product and Material Availability but Higher Costs: More businesses across the industry expect product and material availability to improve than to worsen in 2024, with interior designers being the most optimistic (47%), followed by design-build firms (44%). However, more businesses also expect costs to rise this year than did so the previous year (43% to 68% in 2024 versus 25% to 43% in 2023).
Profits Retained Despite Revenue Dip in 2023: Most residential design and construction firms reported a deceleration in annual revenue growth in 2023 compared with 2022. Among the seven sectors, only interior designers and general contractors reported somewhat positive revenue growth (1.1% and 0.4%, respectively). Despite the general revenue decline, the majority of pros were able to retain their profits, with a greater proportion of firms across 6 of the 7 industry groups reporting profit increases over decreases. In the construction sector, more than 40% of businesses reported a profit gain.
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High Expectations for 2024: Expectations for positive business performance in 2024 are higher across all seven industry groups compared with expectations for 2023; 61% to 71% of firms are predicting a good or very good performance in 2024 versus 50% to 56% in 2023. Interior designers are the most optimistic, with more than 70% expecting a good or very good year, followed by design-build firms and general contractors (66% and 65%, respectively). In contrast, building and renovation firms are the least optimistic, with 61% expecting the same.
Increased Demand for Services Expected: More than half of businesses (54% to 62%) across the industry groups anticipate a higher demand for their services. The shares are more than double the shares (21% to 32%) of those expecting more demand at the beginning of 2023.
Revenue Growth Estimates Rebound: Businesses across all seven industry groups expect an increase in revenue and profits in 2024, following a challenging 2023 environment. Interior designers and architects have returned to more typical revenue growth expectations in 2024 (8.9% and 5.3%, respectively), in contrast to their cautious forecast for 2023 (3% and 0.3%, respectively). Among construction professionals, building and renovation specialists have the highest anticipated revenue growth, followed by general contractors, remodelers and builders, and design-build firms (8.1%, 7.7% and 3.3%, respectively).
Decreased Labor Availability and Rising Labor Costs: Six of the 7 industry groups predict that labor shortages will continue in 2024. Expectations for rising labor costs in 2024 also are prevalent across the industry, with more firms (38% to 58%) planning for higher costs compared with the previous year (24% to 35%).
Better Product and Material Availability but Higher Costs: More businesses across the industry expect product and material availability to improve than to worsen in 2024, with interior designers being the most optimistic (47%), followed by design-build firms (44%). However, more businesses also expect costs to rise this year than did so the previous year (43% to 68% in 2024 versus 25% to 43% in 2023).
Profits Retained Despite Revenue Dip in 2023: Most residential design and construction firms reported a deceleration in annual revenue growth in 2023 compared with 2022. Among the seven sectors, only interior designers and general contractors reported somewhat positive revenue growth (1.1% and 0.4%, respectively). Despite the general revenue decline, the majority of pros were able to retain their profits, with a greater proportion of firms across 6 of the 7 industry groups reporting profit increases over decreases. In the construction sector, more than 40% of businesses reported a profit gain.
Download the Full Report
See Related Stories: