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Economic Growth
CESA Economic Growth on par with

Expectations

Consulting Engineers South Africa’s latest Bi- with the pace experienced during the pre-2010
annual Economic and Capacity Survey (BECS) World cup preparation phase. That trend between
- January to June 2013, indicates conditions in confidence levels amongst consulting engineers
the first six months of 2013 were not as bad as and contractors has however shown some
expected, considering the better than expected improvement, as contractors are slightly more
increase in earnings, alongside a healthy increase optimistic. Confidence in the consulting engineering
in employment. The industry continues to have to sector generally lags business sentiment. Business
adapt to a low growth environment as the outlook for sentiment recovered to a level of 50 (neutral)
infrastructure spending continues to be hampered but is unlikely to be sustained or even improve
by poor economic growth, lower than expected considering the current economic turmoil in terms
revenue by government, international economic of the expected negative impact of strike action
instability and price volatility, and low private sector during the month of August on the economy.
confidence.
Fee Income
We shall continue to track the economic activity of
the country via this economic and capacity reporting Member firms’ fee income earned accelerated at a
tool for our member’s benefit. CESA intends to be faster pace than expected in the first six months of
the advisor of choice to the three tiers of Government 2013, after slowing down in the last half of 2012 but
in order to harness and harmonize the Consulting that real annual fee earnings are lower on the back
Engineering service for the benefit of quality of of higher inflation. Added to this approximately
service to the nation at large, bearing in mind global 9,9% of fee earnings were outstanding for longer
standards as set by the International Federation of than 90 days, compared to 8, 3% in the December
Consulting Engineering (FIDIC) of whom CESA 2012 survey and 24% in December 2011. This
is a member, states Lefadi Makibinyane, CESA translates to an estimated R2bn outstanding in fee
CEO. The way that infrastructure projects are earnings.
planned and packaged requires a concerted effort
by Government and the inclusion of Consulting Human Resources
Engineering firms at this initial planning stage need
to be emphasized, he contends. Makibinyane There was a notable increase in employment
continues by stating that going forward, CESA during the first six months of 2013. Employment
shall share the strategy of how to achieve this increased by 22% to an estimated 24,356 as at
with Government and SOE’s through continuous June 2013 translating into a positive outlook for
bilateral meetings. the recruitment of engineers. The employment of
African (Black, Colored and Asian) professional
Industry Confidence Engineers increased by 14% in the first six months
compared to the December 2012 survey. The
In spite of this confidence levels improved by appointment of African unregistered engineers
20% to a level of 84 (compared to an expected however fell by 8%. Trying to conform to BBBEE
76), and is expected to be relatively stable in the requirements, means demand for black engineers
next 12 months, with a slightly better outlook for will continue to put pressure on firms, as there are
the industry in the first six months of 2014. The simply not enough black engineers available to fill
confidence index increased to an expected level those positions.
of 94 for June 2014. It just didn’t materialize into
the expected earnings. The relationship between Industry Equity
confidence levels of consulting engineers and
civil contractors deteriorated from 2009 onwards, Black (including Asian and Colored) equity, including
as consulting engineers seem to remain busy, executive directors, non-executive directors,
while work opportunities for civil construction members and partners, increased to 35,5% from
deteriorated, or otherwise put, could not keep up 30,1% and 28,1% in the previous two surveys. This

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