january - june 2010 biannual economic and capacity survey

January - June 2010

Biannual Economic and Capacity Survey

Salient Features

Fewer responses combined with a much lower representation from smaller firms (4% compared to 38% in preceding survey (Dec-09)) Marginal increase in fee income, up 3% since the last six months of 2009, but still down 5% compared to same period in 2009. Fee income in real terms down 8,1% y/y (constant prices) No real change in employment estimated at 19 632 as at June 2010 Salaries represented 54% of total turnover, estimated at R8,3 bn (current prices) Confidence levels were better than expected in the first six months, and marginally higher at 87,1 compared to the preceding quarter. Confidence

however deteriorates in the second half to 71.9, with a much improved outlook for 2010, recovering to 93.6. Although the bulk of earnings are in the civil sector, earnings dropped 19% y/y constant prices, but increased by 12% y/y in structural services.

There was an impressive 98% increase in earnings in the environmental sector in the last 6 months to an estimated R749m constant prices. Earnings in Gauteng improved in the last 6 months (up 15,8%) but is still 31% lower compared to the same period in 2009 Earnings in the Western Cape deteriorated in the last 6 months, but was up an impressive 59% y/y There was a notable increase in earnings across South African borders in the last 12 months. Earnings within the central government were up 135% y/y, to over R1,4bn in June 2010, with a 19% increase in provincial government earnings.

Earnings within the private sector were 32% lower compared to last year. Earnings in transportation increased by 24%, and a 35% increase was reported in earnings in the commercial sector. Housing edged up by 7%. Earnings on water services fell by a disappointing 30% compared to last year. Competition in tendering intensified, with 73% of respondents reporting fierce competition (compared to 44,7% in the preceding survey) Profits only deteriorated slightly, in spite of higher levels of competition, and averaged 15,4% during the first 6 months. Discounting however increased from an average of 16,4% to 18,9% Fewer firms are expecting to increase staff Capacity utilization has fallen to 87.5 (from 89.5 in the December 2009 survey) The value of bursaries increased to 0.86% of the salary bill The issue of payment has become a greater problem in this survey, up to 23,4%, from 18,5% in the preceding survey, mainly due to poor payment

from parastatals, and the private sector. A weakening was also reported in payment received from central government. There was no change in local government, but it remained unacceptably high at 16% of payment outstanding for longer than 90 days.

CESA Biannual Economic and Capacity Survey June 2010

Civil Industry Outlook: 2nd Quarter 2010

CESA Biannual Economic and Capacity Survey June 2010

According to the SA Reserve Bank, the general economy contracted by 1,8% during 2009, the ‘overhang’ of whichis still felt in a rising unemployment rate. The good news is that most indicators show strong recovery and grossdomestic product grew (annualised) at 4,6% during the 1st quarter of 2010. Consumption expenditure (bothconsumer and government) increased strongly, and the decline in inventory holdings by companies slowed down.The general economic outlook is still subdued for 2010 (2.5%) and somewhat better during 2011/12 (3.5% to 4%).Whereas the general economy is coming out of its sharp recession quite strongly and despite the much talkedabout R845 billion to be spent over 3 years, capital expenditure is slowing down. Gross fixed capital formation bydifferent clients showed mixed trends; all tiers of government recorded lower capital expenditure (-1,2% for 2009 & -8% for 1st Q 2010), and so did private sector investment spending (-7% for 2009 & -0,7% for 1st Q 2010). Publiccorporations’ fixed investment grew by 41% during 2009, but only 7% recently (1st Q 2010).

The Confidence Index recovered to roughly the same level it was at the beginning of 2009. Over the last 12 monthsit declined 41%, the last 6 months by 24% and improved 20% over the last quarter! This is a VERY good sign andindicates an expected turn of fortune a year and a half away. The cumulative number of tenders invitations declinedby 16% over a year, by 20% over 6 months but actually improved quarter on quarter (ending 1st quarter 2010). Theaverage value kept on declining though. This still indicates tough times in the short term. The latter is reflected inthe value of contracts awarded dropping by 55% over 12 months, 62% over 6 months and again over the lastquarter (ending 1st quarter 2010). It seems as if the bottom of this indicator is still some time away. The result is thatestimated civil engineering turnover declined by 23,5% in real terms compared to a year ago, and 33% over a 6months period (ending 1st quarter 2010). It is expected to decline by 39% (real) in calendar 2010 compared to 2009.Re-estimated annual employment started to show stronger signs of contraction; a decline of 7% on a year ago, and-13% over a 6 months period. The fear expressed in our last report that companies cannot hold on to theirunoccupied staff is becoming a reality.

The general economy is recovering well after the sharp recession but despite the much talked about R845 billion tobe spent over 3 years, capital expenditure is slowing down with delivery bottlenecks to execute micro economicpolicies at the heart of the problem. The lack of a coherent policy framework (between macro and micro policies),political fractions within the ruling elite and a growing, yet increasingly underperforming ‘developmental state’ allcontribute to this.

Source: SAFCEC

CESA Biannual Economic and Capacity Survey January – June 2010

Firm distribution based on Annual Turnoverbased on responses received: January – June 2010

Category by gross annual income

% of firms

0 – R1,5m 4%

R1,5m – R11,5m 34%

> R11,5m62%

Total 100.0%

0-1.54.0%

1.5-11.534.0%

>11.562.0%

Firm distribution based on turnover

0-1.538.0%

1.5-11.543.0%

>11.519.0%

Firm distribution based on turnover: Dec-09


Economic Impact

Relationship to Gross Fixed Capital Formation

Consulting Engineering IndustryFee income, Rm Constant 2000 prices (CPI Deflated) Annualised

Jun-96 Jun-97 Jun-98 Jun-99 Jun-00 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-100

2,000

4,000

6,000

8,000

10,000

12,000

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

Survey period

PE

RC

EN

TA

GE

% 13% 12% 8% -20% -18% -11% -8% 6% 14% 5% 5% 5% -8% -8% 2% 8% 8% 17% 51% 38% 14% 20% 40% 43% 2.10% -16.90 -8.10

Jun-

97

Dec-

97

Jun-

98

Dec-

98

Jun-

99

Dec-

99

Jun-

00

Dec-

00

Jun-

01

Dec-

01

Jun-

02

Dec-

02

Jun-

03

Dec-

03

Jun-

04

Dec-

04

Jun-

05

Dec-

05

Jun-

06

Dec-

06

Jun-

07

Dec-

07

Jun-

08

Dec-

08

Jun-

09

Dec-

09

Jun-

10

Consulting Engineering IndustryReal Fee income (CPI deflated), 2000 prices: Annual Change

-60%

-40%

-20%

0%

20%

40%

60%

Jun

-95

Jun

-97

Jun

-98

Jun

-99

Jun

-00

Jun

-01

Jun

-02

Jun

-03

Jun

-04

Jun

-05

Jun

-06

Jun

-07

Jun

-08

Jun

-09

Jun

-10

Jun

-11

% Change fro

m p

revio

us

surv

ey

-10

10

30

50

70

90

110

% R

esp

ondents

sati

sfied

% Chg Index

CESA Confidence Index

Industry Confidence

20

30

40

50

60

70

80

90

100

110

Jun-

96

Jun-

97

Jan-

98

Jun-

98

Jan-

99

Jun-

99

Jan-

00

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

Dec

-10

Jun-

11

CO

NF

IDE

NC

E IN

DE

X

0

2 000

4 000

6 000

8 000

10 000

12 000

Fee

inco

me

(con

stan

t pr

ices

)

Confidence Fee income Constant prices

Consulting Engineering IndustryReal Fee income (CPI deflated) vs confidence

20

30

40

50

60

70

80

90

100

110

Jun-

96

Jun-

97

Jan-

98

Jun-

98

Jan-

99

Jun-

99

Jan-

00

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

Dec

-10

Jun-

11

CO

NF

IDE

NC

E I

ND

EX

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

15000

16000

17000

18000

19000

20000

Fee

in

com

e, R

mil

l, c

urr

ent

pri

ces

Confidence Fee income Current prices

Consulting Engineering IndustryNominal Fee income vs confidence


-5%

0%

5%

10%

15%

20%

25%

30%

Jun-

98

Jan-

99

Jun-

99

Jan-

00

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

CESA Labour Cost Indicator: Y-Y Change

8 500

9 500

10 500

11 500

12 500

13 500

14 500

15 500

16 500

17 500

18 500

19 500

20 500

De

c-9

7

Jun

-98

De

c-9

8

Jun

-99

De

c-9

9

Jun

-00

De

c-0

0

Jun

-01

De

c-0

1

Jun

-02

De

c-0

2

Jun

-03

De

c-0

3

Jun

-04

De

c-0

4

Jun

-05

De

c-0

5

Jun

-06

De

c-0

6

Jun

-07

De

c-0

7

Jun

-08

De

c-0

8

Jun

-09

De

c-0

9

Jun

-10

Em

ploy

men

t

2 000

3 000

4 000

5 000

6 000

7 000

8 000

9 000

10 000

11 000

Fee

inco

me

(con

stan

t pr

ices

)

Employment Revised Income: CPI 2000 prices Income : CESA LCI 2005 prices

Consulting Engineering IndustryEmployment vs REAL fee income (CPI / LCI Deflated)

9 500

10 500

11 500

12 500

13 500

14 500

15 500

16 500

17 500

18 500

19 500

20 500

Dec

-97

Jun-

98

Dec

-98

Jun-

99

Dec

-99

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

Em

plo

yme

nt

0

300

600

900

1 200

1 500

1 800

2 100

2 400

2 700

3 000

3 300

3 600

3 900

4 200

4 500

4 800

5 100

5 400

Sa

lary

/Wa

ge

s (

R m

ill, 2

00

0 p

ric

es

)

Employment Salary/Wage bill (Constant)

Consulting Engineering IndustryEmployment vs Salary / Wage bill


Discounting

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

%

% 15.10% 16.62% 15.30% 15.30% 18.20% 16.40% 18.90%

JUN07 DEC07 JUN08 DEC08 JUN09 DEC09 JUN10

Question: What is the prevailing discount being offered in a tendering situation to clients by your firm, benchmarked against the ECSA Guideline Fee Scales?

43% of firmsdiscounted by 20% or more


Fee income earned by Sub-disciplines: % ShareJune 2010

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Agricultural

Architecture

Mechanical building Services

Civil

Electrical / Electronic

Environmental

Facilities

Geotechnical

Industrial Process / Chemical

GIS

Hydraulics

Information Systems / Technology

Marine

Mechanical

Mining

Project Management

Quantity Surveying

Structural

Tow n planning

Question: What type of work did your company engage in during the past 6 months?


Fee income earned by Sub-disciplines: % ShareJune 2009 – June 2010

0% 10% 20% 30% 40% 50% 60%

Civil

Mining

Project Management

Structural

Jun-09 Dec-09 Jun-10

Question: What type of work did your company engage in during the past 6 months? 80% of fees are earned in four

disciplines namely civil, project management,

structural and mining


Fee income earned by Sub-disciplines: % ShareChange in the last 12 months

-10% -8% -6% -4% -2% 0% 2% 4% 6% 8% 10%

Agricultural

Architecture

Mechanical building Services

Civil

Electrical / Electronic

Environmental

Facilities

Geotechnical

Industrial Process / Chemical

GIS

Hydraulics

Information Systems / Technology

Marine

Mechanical

Mining

Project Management

Quantity Surveying

Structural

Tow n planning

Question: What type of work did your company engage in during the past 6 months?

0

200

400

600

800

1000

1200

1400

1600

2002 2003 2004 2005 2006 2007 2008 2009 Jun-10

Oth

er,

R m

ill

2000

pri

ces

0

1000

2000

3000

4000

5000

6000

Civ

il,

R m

ill

2000

pri

ces

Structural Proj Mang Mining Civil

Fee income earned by Top four disciplines: R mill 2000 pricesAnnual average: 2002 – June 2010 (annualised)

Civil

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

Wat

er

Tra

nspo

rtat

ion

Ene

rgy

Min

ing/

Qua

rryi

ng

Edu

catio

n

Hea

lth

Tou

rism

Hou

sing

Com

mer

cial

Agr

icul

ture

Oth

er

Per

cen

tag

e sh

are

Dec-08 Jun-09 Dec-09 Jun-10

Fee income earned by economic sectorPercentage market share December 2008 – June 2010

Section A General Questions: Question: Income distribution per economic sector

Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-100

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Water (Full water cycle) Transportation (land, air, road, rail, ports)

Energy (electricity, gas, hydro) Mining / Quarrying

Tourism / Leisure Housing (residential inc. land)

Commercial

Fee income earned by key economic sectorsJune 2006 – June 2010

Section A General Questions: Question: Income distribution per economic sector

Fee income earned by key economic sectorsJune 2005 – June 2010

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

200

400

600

800

1,000

1,200

Housing

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

200400600800

1,0001,2001,4001,6001,8002,000

Water

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

5001,0001,5002,0002,5003,0003,5004,0004,500

Transportation

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

100

200

300

400

500

600

700

Energy

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

500

1,000

1,500

2,000

2,500

3,000

Commercial

Jun-

05

Dec-0

5

Jun-

06

Dec-0

6

Jun-

07

Dec-0

7

Jun-

08

Dec-0

8

Jun-

09

Dec-0

9

Jun-

100

50

100

150

200

250

300

Health


E-Cape W-Cape N-Cape F State N-W Lim Gaut Mpu Kwaz Africa Int'l E-Cape W-Cape N-Cape F State N-W Lim Gaut Mpu Kwaz Africa Int'l

% Share 9.34 16.29 1.62 4.63 2.05 2.73 33.74 2.94 11.92 12.34 2.4

Change last 12 months 1.54 6.89 0.02 2.43 0.15 -0.47 -11.36 0.34 -8.28 8.44 0.3

2.5

7.5

12.5

17.5

22.5

27.5

32.5

37.5

-13

-8

-3

3

8

% Share Change last 12 months

% Sh

are (b

ar)Provincial Market Share: June 2010

Vs change in market share from June 2009

GA

IN

mark

et

sh

are

Section A: General Questions: Question 10Income distribution per province

0

500

1000

1500

2000

2500

3000

3500

4000

4500

R m

ill,

Co

nst

ant

2000

pri

ces

E-CAPE W-CAPE GAUT KWA-NAT

E-CAPE 289 288 353 344 388 450 400 395 465 588 655 667 750 694 654 828 866

W-CAPE 538 527 518 560 478 438 572 681 1058 1164 1077 1253 1285 1 303 1 127 1191 1461

GAUT 1 380 1 343 1 120 947 1 122 1 253 1 239 1 452 1769 1954 2113 2408 2813 3 582 4 212 3485 2802

KWA-NAT 393 387 379 473 436 420 535 591 688 756 839 871 1066 1 300 1 620 1728 1280

Jun'02 Dec'02 Jun'03 Dec'03 Jun'04 Dec'04 Jun'05 'Dec'05 'Jun'06 'Dec'06 Jun'07 Dec'07 Jun'08 Dec'08 Jun'09 Dec'09 Jun'10

Fee income earned by province(High Capacity economies) – Annualised smoothed

Gauteng


0

50

100

150

200

250

300

Dec-98 Dec-99 Dec'00 Dec'01 Dec'02 Dec'03 Dec'04 'Dec'05 'Dec'06 Dec'07 Dec'08 Dec'09

Ind

ex D

ec'9

8=10

0

High capacity Low capacity

Fee income earned (Constant 2000 prices)

High Capacity vs lower capacity provincial economies (Smoothed)


68.00%

70.00%

72.00%

74.00%

76.00%

78.00%

80.00%

82.00%

84.00%

86.00%

88.00%

Per

cen

tag

e

% 76.04% 75.53% 80.12% 80.68% 80.70% 80.63% 80.07% 79.14% 78.25% 79.42% 81.27% 82.57% 82.07% 81.64% 80% 80.23% 83.25% 86.05% 86.95% 84.80%

Dec'00 Jun'01 Dec'01 Jun'02 Dec'02 Jun'03 Dec'03 Jun'04 Dec'04 Jun'05 'Dec'05 'Jun'06 'Dec'06 Jun'07 Dec'07 Jun'08 Dec'08 Jun'09 Dec'09 Jun'10

Fee income earned (Constant 2000 prices)

% of RSA Earnings : High Capacity provincial economies (Smoothed)


Fee income earned : RSA vs EX-RSAR mill, 2000 prices (Annualised, smoothed)


Dec-9

8

Jul-9

9

Feb-

00

Sep-

00

Apr-0

1

Nov-0

1

Jun-

02

Jan-

03

Aug-0

3

Mar

-04

Oct-0

4

May

-05

Dec-0

5

Jul-0

6

Feb-

07

Sep-

07

Apr-0

8

Nov-0

8

Jun-

09

Jan-

100

200

400

600

800

1,000

1,200

1,400

1,600

1,800

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Ex-RSA - left axis RSA - right axis


0

10

20

30

40

50

60

% S

ha

re

Jun-08

Dec-08

Jun-09

Dec-09

Jun-10

Jun-08 9.7 15.8 21 12.8 40.7

Dec-08 7 17.7 27.9 10.4 37

Jun-09 6.4 10.7 23 9.8 50.2

Dec-09 15.7 9.9 27.4 12.8 34.2

Jun-10 16.4 13.9 20.4 12.7 36.6

Central Provincial Local Parastatals Private

Fee income earned by type of client% Share

Section A: General Questions: Question 11Local (SA) Income distribution per fee paying client type, during the past 6 months


0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

JUN

01

DE

C01

JUN

02

DE

C02

JUN

03

DE

C03

JUN

04

DE

C04

JUN

05

DE

C05

JUN

06

DE

C06

JUN

07

DE

C07

JUN

08

DE

C08

JUN

09

DE

C09

JUN

10

R m

ill, C

on

sta

nt

20

00

pri

ce

s

Central

Provincial

Local

Parastatals

Private

Fee income earned by type of clientR mill 2000 prices

(Annualised, smoothed - avg over 2 survey periods)



0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

Rm

, 20

00

pri

ce

s

Public

Private

Public 1 962 2 013 2 108 2 353 2 219 1 996 2 180 2 389 2 417 2 705 3 200 3 470 4 187 3979 5633 6556 4840 5694 5650

Private 1 595 1 627 1 634 1 471 1 440 1 513 1 366 1 290 1 407 1 437 1 941 2 498 2 587 3204 3866 3851 4870 2959 3263

JUN01 DEC01 JUN02 DEC02 JUN03 DEC03 JUN04 DEC04 JUN05 DEC05 JUN06 DEC06 JUN07 DEC07 JUN08 DEC08 JUN09 DEC09 JUN10

Fee income earned by type of clientConstant 2000 prices

(Annualised, smoothed - avg over 2 survey periods)



Competition in tendering

0%

20%

40%

60%

80%

100%

% R

espo

nden

ts

Jun-07 0.00% 2.42% 22.11% 56.29% 19.18%

Dec-07 0.00% 3.01% 17.55% 55.57% 23.86%

Jun-08 0.00% 1.40% 20.80% 48.70% 29.10%

Dec-08 0.00% 0.00% 21.42% 42.28% 36.29%

Jun-09 0.22% 0.51% 62.73% 28.36% 8.18%

Dec-09 0.00% 0.10% 21.80% 33.50% 44.70%

Jun-10 0.00% 8.67% 3.28% 14.79% 73.26%

Very Low Low Keen Very Keen Fierce

Section B: Business Cycle Indicators - Question 16During Jan – June 2010 competition for work was (Tick selection)


Competition in tendering

80%

82%

84%

86%

88%

90%

92%

94%

96%

98%

100%

% R

espo

nden

ts,

com

petit

ion

kee

n to

fie

rce

% 99.9% 99.9% 97.5% 98.9% 98.0% 99.3% 99.0% 98.2% 99.1% 97.8% 98.7% 97.1% 99.5% 99.1% 97.6% 96.9% 98.6% 100% 99.30 99.90 91.30

Jun-

00

Dec-

00

Jun-

01

Dec-

01

Jun-

02

Dec-

02

Jun-

03

Dec-

03

Jun-

04

Dec-

04

Jun-

05

Dec-

05

Jun-

06

Dec-

06

Jun-

07

Dec-

07

Jun-

08

Dec-

08

Jun-

09

Dec-

09

Jun-

10

Section B: Business Cycle Indicators - Question 16During Jan – June 2010 competition for work was (Tick selection)


0

10

20

30

40

50

60

70

80

90

100

Eng O Tech Technologist Technicians Support staff

Jun'06 Dec'06 Jun'07 Dec'07 Jun'08 Dec'08 Jun'09 Dec'09 Jun'10

% of Firms wanting to increase staff

New June 2005 survey


Engineering Skills Shortfall

-10

0

10

20

30

40

50

60

70

80

90

100

De

c-9

7

Ju

n-9

8

De

c-9

8

Ju

n-9

9

De

c-9

9

Ju

n-0

0

De

c-0

0

Ju

n-0

1

De

c-0

1

Ju

n-0

2

De

c-0

2

Ju

n-0

3

De

c-0

3

Ju

n-0

4

De

c-0

4

Ju

n-0

5

De

c-0

5

Ju

n-0

6

De

c-0

6

Ju

n-0

7

De

c-0

7

Ju

n-0

8

De

c-0

8

Ju

n-0

9

De

c-0

9

Ju

n-1

0

% o

f re

sp

on

de

nts

% Wanting to increase engineers Difficulties

Fewer firms want to increase engineers

% Experiencing difficulties


0

10

20

30

40

50

60

70

80

90

100E

ng

O T

ech

Tec

hn

olo

gis

t

Tec

hn

icia

ns

Oth

er

PD

I En

g

PD

I Tec

h

PD

I Tec

hn

o

% R

es

po

nd

en

ts

Jun'08 Dec'08 Jun'09 Dec'09 Jun'10

Recruitment problems


Bursaries% of Salary / Wage bill

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

Dec

-96

Dec

-97

Jun

-98

Dec

-98

Jun

-99

Dec

-99

Jun

-00

Dec

-00

Jun

-01

Dec

-01

Jun

-02

Dec

-02

Jun

-03

Dec

-03

Jun

-04

Dec

-04

Jun

-05

Dec

-05

Jun

-06

Dec

-06

Jun

-07

Dec

-07

Jun

-08

Dec

-08

Jun

-09

Dec

-09

Jun

-10


0

10

20

30

40

50

60

70

80

90

Dec

-96

Jun

-98

Jun

-99

Jun

-00

Jun

-01

Jun

-02

Jun

-03

Jun

-04

Jun

-05

Jun

-06

Jun

-07

Jun

-08

Jun

-09

Jun

-10

R m

ill, 2

000

pri

ces

BursariesR mill 2000 prices (Annualised)


0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

Jun

e 20

05

Dec

emb

er20

06

Jun

-06

Dec

-06

Jun

-07

Dec

-07

Jun

-08

Dec

-08

Jun

-09

Dec

-09

Jun

-10

Training (Salaries and Direct Training Costs) % of Payroll

Dat

a no

t ava

ilab

le

Large % of respondents did not complete information on salaries in December 2009 survey

Dat

a no

t ava

ilab

le


0

500

1000

1500

2000

2500

3000

jun

e 20

05

Dec

emb

er20

05

Jun

-06

Dec

-06

Jun

-07

Dec

-07

Jun

-08

Dec

-08

Jun

-09

Dec

-09

Jun

-10

Training (Salaries and Direct Training Costs) Rand millions, Constant 2000 prices

Dat

a no

t ava

ilab

le

Large % of respondents did not complete information on salaries in December 2008 and 2009 survey

Dat

a no

t ava

ilab

le


0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%D

ec

-97

Ju

n-9

8

De

c-9

8

Ju

n-9

9

De

c-9

9

Ju

n-0

0

De

c-0

0

Ju

n-0

1

De

c-0

1

Ju

n-0

2

De

c-0

2

Ju

n-0

3

De

c-0

3

Ju

n-0

4

De

c-0

4

Ju

n-0

5

De

c-0

5

Ju

n-0

6

De

c-0

6

Ju

n-0

7

De

c-0

7

Ju

n-0

8

De

c-0

8

Ju

n-0

9

De

c-0

9

Ju

n-1

0

%Training (Direct costs only)

% of Payroll


0

10

20

30

40

50

60

70

80

90

100D

ec-9

7

Jun

-98

Dec

-98

Jun

-99

Dec

-99

Jun

-00

Dec

-00

Jun

-01

Dec

-01

Jun

-02

Dec

-02

Jun

-03

Dec

-03

Jun

-04

Dec

-04

Jun

-05

Dec

-05

Jun

-06

Dec

-06

Jun

-07

Dec

-07

Jun

-08

Dec

-08

Jun

-09

Dec

-09

Jun

-10

R m

ill 2

000

pri

ces

Training (Direct costs)Rand millions, Constant 2000 prices


0

50000

100000

150000

200000

25000020

01

2002

2003

2004

2005

2006

2007

Student enrolments in public higher education institutionsScience, Engineering & Technology

Increased by 39% between 2005 and 2007

214 341

Source: Department of Education


0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

Jun-

98

Jan-

99

Jun-

99

Dec

-99

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

Uti

lisa

tio

n

-40

-20

0

20

40

60

80

Net

% c

han

ge

exp

ecti

ng

in

crea

se

Net % Change Utilisation

Industry Capacity UtilisationOf existing technical staff


Total fee income outstanding, by client Exceeding 90 days

0

10

20

30

40

50

60

70

Ce

ntr

al

Pro

vin

cia

l

Lo

ca

l

Pa

ras

tata

ls

Pri

va

te% o

f T

ota

l fe

e in

co

me

ea

rne

d

Jun-08 Dec-08 Jun-09 Dec-09 Jun-10

Fee income outstanding for longer than 90 daysJune 2010


Total fee income outstanding for longer than 90 days% of total fee income earned

0

5

10

15

20

25

Dec

-99

Jun-

00

Dec

-00

Jun-

01

Dec

-01

Jun-

02

Dec

-02

Jun-

03

Dec

-03

Jun-

04

Dec

-04

Jun-

05

Dec

-05

Jun-

06

Dec

-06

Jun-

07

Dec

-07

Jun-

08

Dec

-08

Jun-

09

Dec

-09

Jun-

10

% o

f T

ota

l fe

e i

nc

om

e e

arn

ed

Su

rvey a

men

ded

to

in

clu

de f

ore

ign

clien

ts


Escalation trendsYear-on-Year % Change

0

2

4

6

8

10

12

14

An

nu

al C

han

ge,

%

% 8.7 6.9 5.8 5.3 5.7 9.2 5.9 1.4 3.4 4.6 6.6 11.6 7.13 5.6 5.1 5.7 5.6 6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Based on headline consumer inflation (CPI)Forecasts Industry Insight Economist Poll

Source: ABSA

CPI Basket Revised in January 2009


Consulting Engineering ProfessionLabour unit cost indicator: Year-on-Year % Change (Smoothed)

-5%

0%

5%

10%

15%

20%

25%

30%

LUC 15.2% 11.4% 22.5% 21.8% 9.2% -1.9% 3.7% 15.0% 8.0% 2.88% 4.30% 14.30% 22% 11.30% 5.30% 7.20% 9.50% 10.60% 9.10% 10.20%17.80%25.50%20.60%10.70%4.30%

J un-98

Dec-98

J un-99

Dec-99

J un-00

Dec-00

J un-01

Dec-01

J un-02

Dec-02

J un-03

Dec-03

J un-04

Dec-04

J un-05

Dec-05

J un-06

Dec-06

J un-07

Dec-07

J un-08

Dec-08

J un-09

Dec-09

J un-10


Consulting Engineering ProfessionLabour unit cost indicator: Annual Average Y-Y Chg

0%

5%

10%

15%

20%

25%

LUC 22.2% 3.7% 9.4% 5.4% 9.3% 16.3% 6.30% 10% 9.65% 21.67% 15.64% 4.30%

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Jun-10


Typical Employment BreakdownJanuary – June 2010

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Professional Engineer Pr.Eng

Professional Architects

Professional Quantity Surveyors

Professional Other

Technologists Pr TEchENg

Technicians PrTechni

Unregistered technical staff: Engineer

Unregistered technical staff: Technologist

Unregistered technical staff: Technician

Unregistered technical staff: Other

Technical Assistants

Draughtspersons

Laboratory / Survey Assistants

Administration / Support staff

Total

Black Coloured Asian White

Typical Employment profile: January – June 2010

Total employment 19 632


0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

'Dec-03

Dec-04

Jun-05

Dec-05

Jun-06

Dec-06

Dec-07

Jun-08

Dec-08

Jun-09

Dec-09

Jun-10

Black Coloured Asian White

Overall Employment Breakdown, by raceDecember 2003 – June 2010


10%

15%

20%

25%

30%

35%

De

c-9

9

Ju

n-0

0

De

c-0

0

Ju

n-0

1

De

c-0

1

Ju

n-0

2

De

c-0

2

Ju

n-0

3

De

c-0

3

Ju

n-0

4

De

c-0

4

Ju

n-0

5

De

c-0

5

Ju

n-0

6

De

c-0

6

Ju

n-0

7

De

c-0

7

Ju

n-0

8

De

c-0

8

Ju

n-0

9

De

c-0

9

Ju

n-1

0

%Employment profile: Black only (excluding Asian / Colourds)

representation of total employment % Share of total employment


Professional Indemnity InsuranceRisk profile

0%

10%

20%

30%

40%

50%

60%

70%

80%

%

Dec-07 65.2% 30.3% 4.6%

Jun-08 58.7% 39.7% 1.6%

Dec-08 65.8% 34.2% 0.0%

Jun-09 71.4% 28.6% 0.0%

Dec-09 75.0% 17.5% 7.5%

Jun-10 68.80% 28.10% 3.10%

Low Medium High

In terms of firm’s perceptions of risk, close over 70% of respondents said that their firm had a low risk exposure, compared to almost 30% saying it was regarded as medium.


0%

10%20%

30%40%

50%

60%70%

80%90%

100%J

UN

06

DE

C0

6

JU

N0

7

DE

C0

7

JU

N0

8

DE

C0

8

JU

N0

9

DE

C0

9

JU

N1

0

%

Pty Ltd CC Partnership

Equity Distribution by firm type


0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

JU

N0

6

DE

C0

6

JU

N0

7

DE

C0

7

JU

N0

8

DE

C0

8

JU

N0

9

DE

C0

9

JU

N1

0

Ownership / Equity: % Share of total employmentPTY, CC & Partnerships


0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

JU

N0

6

DE

C0

6

JU

N0

7

DE

C0

7

JU

N0

8

DE

C0

8

JU

N0

9

DE

C0

9

JU

N1

0

Bla

ck

eq

uit

y a

s %

of

tota

l Eq

uit

y

Black equity as % of total equity

Black Ownership / Equity: % Share of total ownership / equityPTY, CC & Partnerships

Black, including Asian & Coloured

- Women represented 4,7% of total ownership / equity compared to 6% in the June 2009 survey- Black women represented 3,5% of total ownership / equity compared to 3,4% in the December June

2009 survey


0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%

Pty_exec

Pty_nonexec

Member of CC

Partner

%

Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10

Jun-10 25.50% 28.60% 47.60% 0%

Dec-09 19.6% 88.9% 51.8% 0.0%

Jun-09 14.2% 70.0% 20.0% 0.0%

Dec-08 13.5% 81.5% 36.8% 0.0%

Jun-08 18.5% 72.0% 41.2% 0.0%

Dec-07 16.9% 55.0% 24.1% 0.0%

Jun-07 21.9% 58.5% 32.5% 7.7%

Pty_exec Pty_nonexec Member of CC Partner

Black ownership / equity as % of total ownership / equity by type of company

June 2007 – June 2010

Black includes Asian and Coloureds


0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

%

J un-08 100.0% 72.7% 94.4% 75.0% 84.0%

Dec-08 100.0% 93.0% 100.0% 75.0% 84.0%

Jun-09 100.0% 93.3% 100.0% 75.0% 93.0%

Dec-09 100.0% 100.0% 100.0% 100.0% 100.0%

Jun-10 100.0% 91.0% 100.0% 100.0% 97.0%

Large Medium Small Micro Total

Quality Management System


0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

%

J un-08 81.8% 36.0% 11.0% 0.0% 30.1%

Dec-08 87.5% 46.7% 20.0% 0.0% 42.0%

Jun-09 90.0% 20.0% 20.0% 12.5% 34.8%

Dec-09 90.9% 42.1% 14.3% 16.7% 45.2%

Jun-10 100.0% 27.0% 17.0% 20.0% 50.0%

Large Medium Small Micro Total

ISO 9001:2000 Certificate

Thank youwww.cesa.co.za

Tel: 011 463 2022

http://www.cesa.co.za/

january - june 2010 biannual economic and capacity survey

Documents

months period

preceding quarter

improved quarter

nd quarter

capacity survey slide

provincial government

civil sector

preceding survey zprofits