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Technology Benchmark: The Recession is Over; So Where’s the Boom?
by Harry O. Ward, PE
September 16, 2009

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Figure 1. Harken-Reidar rendering of expansions at the VA Hospital in Washington, D.C.
Federal Reserve Chairman Ben Bernanke declared on September 15 that the recession is probably over. Tell that to the land development community, which has been decimated in every category. Surveyors were among the first to be hit, followed by the designers, the firms they work for and ultimately the contractors and builders.

Unfortunately, what Bernanke meant is that the technical definition of the recession being over—that is, two consecutive quarters of negative growth in real gross domestic product—has been achieved. So this could be it—the economic world we now must live in. There is no coming boom; it isn’t “coming back” any more than it has now. We have all cut staff, closed offices and become more lean and mean, and I am sorry to say that this is the new world order. We must learn to make money and thrive in this economy as it now exists.

But wait! I see a major catalyst on the horizon that could actually turn the economy around and lift it to a level of prosperity that may mimic what we had several years ago. Check recent history. In the 1991 recession, which also devastated the design/surveying business, the U.S. economy was catapulted out of its doldrums by the dot-com boom. The rapid development of e-commerce revolutionized the world. New value was created out of nothing. The country capitalized on it, and prosperity thrived.

Of course, that boom created a bubble that eventually burst and led the nation into another recession in 2000 with the double whammy of the 9/11 attacks. Again, our country sank into the doldrums. What pulled us out of that situation was another major catalyst—the building boom funded by subprime mortgages. As we now know, this irresponsible folly caused a worldwide recession because of the greed involved.

The point is that in each recession, we were doomed to a pitiful stagnation—or, at best, a slow-growth economy—until these major catalysts kicked in and unprecedented levels of prosperity resulted. Clearly, what we need is another major catalyst, and I think I know exactly what it will be: health care reform.

Think about it. The idea of health care reform is to insure all Americans. This insurance will allow the estimated 40 million people who are currently uninsured to receive health care, and that care will extend to wellness programs, prescription medications, doctor visits and clinic visits. As a result, there will be enormous growth in the design and construction of clinics, hospital expansions, new hospitals, new doctors' offices, expanded medical waste facilities and new pharmacies. Additionally, the need for more doctors will also cause medical schools to expand rapidly, which will increase the need for new college buildings and a variety of new support facilities.

Every one of these facilities will require new parking lots, new and expanded utilities, new zoning and new surveys.

So, my recommendation is that firms and their respective staffs should prepare now to become experts in the medical construction field. Identify what this industry requires, and provide it. Be among the first to market to this segment, and become known as a knowledgeable service provider.

If anyone doubts my thinking just consider: “When has the government ever done anything efficiently?” Never, and this is no exception. The medical field will grow to unprecedented levels, and the need for engineering and surveying services will grow with it. You heard it here first!


What do you think? Please post your comments below.


Harry O. Ward, PE
hward@harken-reidar.com
Harry O. Ward, PE, is a registered professional engineer, a state licensed contractor and certified in machine control. He is president of Harken-Reidar (www.harken-reidar.com), a new infrastructure solutions company. He has been a member of the engineering faculty at George Mason University since 1997. He can be reached at hward@harken-reidar.com.

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  Comments (8)Post a Comment
Title: Yeah Right!


Sounds good and I've got a bridge for sale in Brooklyn.


Title: This is right on and our company is on it!


our company already has a group assembled for professional medical facility design, so the author is absolutely correct. this has been one of the busiest department's in the firm for the past year. we have tied it into BIM in the arch. dept. there is nothing arguable about the author's comments.


Title: In this economy diversify


I think the author is right. There is going to be a growing market in the development of medical and long term care facilities. We've seen some of it. I think Wind and Solar Power, Hydrographic Mapping, and GIS Mapping are going to be growing markets. Some, if not all, of us may have to re-think our business models and professional service attitudes to gear up for the changing work fields. I guess that's part of life. What's that song's phrase "life's about changes nothing ever stays the same". Keep your chin up and look for the window of opportunity.


Title: reinvention more likely...


Harry's 2nd paragraph tells the whole story. If you were one of the old timers laid off earlier this year, chances are you're not coming back. The money that was saved from your exit will eventually put the goodies in the basket (GIS tools, laser scanning equipment)for the firm you used to work for that didn't have them before. Young "whipper-snappers" will take over, and their weeks maybe less than 40hrs. But I remain optimistic that these 20 somethings will get bored, and the old farts may feel new again.


Title: sometimes it is the other way around


i worked for a DOT and they just laid off over 1,000 people. the ones that were let go were the young whippersnappers you refer to "get real". all that is left are the old "senior" people who cant do anything except fall asleep in meetings. they need to rethink this seniority method of laying people off.


Title: I agree


My sister works for a real estate tycoon in California and three years ago she was told to purchase all the real estate surrounding the hospitals that she could. I believe you are right on target Mr. Ward! In a dying real estate market guess which areas are growing in value?

www.machinecontroltechnologyinc.com


Title: let's pass healhcare reform


I guess Harry's points are great if you live in a town that lacks medical facilities. Where I'm from, there are plenty of med facilities and recently remodeled one's, so I guess I wait for the commercial sector to come around.


Title: Med Facilities


I am in Houston where we are a leader in medical facilities. These facilities are full now and there is a point to idea that if millions more people were to seek health care and pharma's there would be overloading. That is surely true in houston and we have the "med center", baylor, ben taub, et al...


 

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