The 2011 RJ Western Trends Survey
January 3, 2012
The results of the 2011 Reeves Journal Western Trends Survey tell an interesting story this year as, for the first time, we added a series of questions regarding whether contractors have taken the solar thermal plunge. Since that market is in its infancy at the moment it's still a pretty wide-open field, with 38 percent of responding contractors saying they expect requests for solar thermal plumbing work to increase during 2012.
The story for the rest of the West for the year just passed was pretty much the same as the year prior. While there has been another slight improvement on the commercial side and a few of the numbers we track have changed by a few percentage points, but certainly nothing outside the survey's margin of error or anything which could be called out as a "recovery." In fact, since 2011 was so similar to 2010, the headline for this year's report could just as well be, "Thank You, Sir! May I Have Another?"
This market segment is still miniscule in the West--71 percent of respondents reported neither recommending nor installing any solar thermal products during 2011--but simply looking around at the rooftops in neighborhoods in your service area will reveal installations are picking up.
Of the 29 percent of respondents who reported recommending or installing solar thermal products, 32 percent said their 2011 solar thermal projects were exclusively domestic hot water applications, while six percent said all of their projects were of the space heating-only variety. Another six percent of respondents said their 2011 solar thermal projects were designed for both DHW and space heating.
For 2011, residential made up the lion's share of projects for respondents, with 67 percent saying their work was exclusively residential during the year. On the other side of the coin, some 21 percent of this year's respondents said Commercial-Industrial-Institutional applications were the only solar thermal projects they completed during 2011. On the psychic front, fully 85 percent of this year's respondents predict solar thermal plumbing requests will "increase" (38 percent) or "stay the same" for 2012.
Currently there are plentiful federal, state and local incentives tied to solar installations, including solar thermal. Fully 76 percent of this year's responding contractors said the absence of those credits and incentives would "decrease" (41 percent) or "significantly decrease" the sales of solar thermal products.
Residentially speaking, Western contractors reported flat performance for 2011, with fully 56 percent saying residential construction had "decreased" (32 percent) or "significantly decreased" (24 percent) in their areas during 2011.
Of the 10 percent of respondents who reported an increase in residential construction for 2011, 75 percent of them said the increase was "less than 10 percent" (42 percent) or "between 10- and 14 percent (33 percent). Fully 77 percent of this year's respondents who reported a downtrend said residential construction was off by 25 percent or more in their areas.
Of the 61 percent of respondents to the previous year's survey who said residential construction had decreased in their area during 2010, fully 80 percent of them indicated the drop-off had been 25 percent or more over the prior year. That's still a virtual dead heat with the 2009 results, when fully 89 percent of respondents said the drop-off in residential work was 25 percent or greater.
Reasons given by those reporting an increase in 2011 residential construction included: "more people are comfortable spending money"; "the economy has picked up"; and, "buyers still want new housing."
The faint glimmer of optimism pointed to in last year's survey for the C-I-I segment continues for 2011. For this year's survey, 19 percent of respondents said CII word had either "significantly increased," (1 percent) or "increased" (18 percent).
Among the 19 percent who said CII construction has picked up, 36 percent said it had increased 25 percent or more during 2011. However, things aren't quite so rosy appearing throughout the region. Fully 41 percent of this year's respondents reported a drop-off in CII construction and, of them, 74 percent said it had decreased in their areas 25 percent or more.
By way of comparison, some 52 percent of respondents to last year's survey said CII construction in 2010 had either stayed the same (36 percent) or increased (16 percent) over 2009. Last year, 48 percent of respondents said CII had "stayed the same" (33 percent) or "increased" (15 percent.) Of the fortunate few who saw an increase in their areas' CII construction during 2010, 40 percent of them said the increase was 25 percent or more.
The reasons given by respondents who saw increased CII construction in their areas included: "bond measures passed and stimulus money"; "investors are taking advantage of low interest rates and commercial loans are easier to get than residential"; and, "some retailers are starting to hire."
For this year's survey, 3,067 questionnaires were e-mailed to active, qualified Reeves Journal subscribers who both self-identified as contractors and who have reported having the job function of owner/partner, president/officer or manager.
The survey, administered over the Internet, was available to respondents Oct. 11-25, 2011.
Of the 3,067 questionnaires e-mailed, 63 opted out or were otherwise undeliverable, leaving a usable base of 3.004 possible respondents. We received 119 usable responses at the end of the survey, resulting in a response rate of 4 percent.