As many people know, the Architectural, Engineering and Planning (AEP) industries have been decimated over the past few years due to the downturn in the economy. Countless AEP companies have gone out of business or, at the very least, drastically cut back on staff. The Civil/Site Engineering industry has been hit particularly hard. There are at least three civil engineering firms that no longer exist in metro Atlanta and at least one Atlanta-metro Architectural and Engineering (AE) firm that no longer has civil engineering in-house. I am hard-pressed to think of any civil/site engineering colleagues who have not suffered a layoff. Most firms are working with a skeleton crew, and in many cases, that consists of one or two people.
The AE community has suffered a great deal from lack of development over the past few years, but many have managed to stay afloat through renovation work. Civil engineering services are rarely needed for renovation of existing developments; thus many civil engineers have been let go by their employers. Their exit strategy has typically been to leave the industry or, for the entrepreneurial type, start a small civil engineering business of their own.
What is interesting is that small civil engineering firms composed of one or two individuals are now competing with the once much larger and well-established firms for projects….and they have been getting them! In March of this year, I sat in a continuing-education seminar with three other civil engineers. Each used to work at larger firms, but is now working for themselves out of their home and doing very well, I might add. At least one of them is the sole bread-winner of their household, supporting a family of four. To what do they owe their prosperity? Market forces have dictated their success. These small 1-2 person firms have much lower overhead/operating costs and can therefore offer comparable products and services at a much lower fee. In most cases, the person doing the work in the small firm is an experienced civil engineer that was earning a hansom salary prior to 2007. However, at some point, their employer had to let them go, not because they were bad engineers, but instead because the employer could no longer afford to maintain the salaries, insurance premiums, and other overhead costs of all their employees due to the reduction of work in our market sector.
So what does all this mean with regard to civil/site engineers? It seems that larger firms are still large enough to get the “big client” contracts while the medium size firms are struggling to compete with small groups of talented individuals or one-person firms for the rest of the work.
Many clients have discovered the value of hiring the small civil/site engineering firms: it all boils down to getting an experienced civil engineer with the same software capabilities, the same insurance protection, the same, if not better, quality of service, and the same product, but with much lower overhead costs. This, of course, translates to a much lower fee. In fact, the person preparing the product in the small CE firm often offers more experience to their clients than the person who would be preparing the product if the client paid the higher fee necessary to engage a large firm. More experience in any field commands a higher salary, but isn’t it nice to get the advantage that experience can offer without paying extra for overhead that isn’t necessary in the age of the internet. With everyone keeping a closer eye on their budgets lately, it is easy to see what the market has decided.
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