Building on a Solid Foundation

Earlier this spring, Kansas City’s TIF Commission signed off on a plan by Burns & McDonnell to spend $130 million for an expansion of its headquarters in south Kansas City. The goal, say company officials, will be accommodating 2,100 new employees they expect to hire over the next decade as they continue to climb the ranks of the largest engineering firms in the country.

If recent history is an indication, Burns & Mac will need the space: The company’s revenues soared by 15 percent from 2012 to 2013, as it—and the engineering sector overall—continued to shake off the last vestiges of a gruesome, half-decade downturn in the construction sector. From the time it started to take full effect on the construction and design community nationwide in 2008, the recession and subsequent weak recovery put a crimp in operations for many engineering firms, as well.

That context makes all the more impressive the gains made by this region’s engineering companies in recent years. A longer view of employment trends at those firms, going back a decade in the run-up to the recession, shows significant growth in the numbers of professional engineers employed regionally.

For the better part of a century, Kansas City has developed a reputation for having more engineers per capita than any other city in the nation. That’s largely because the founders of the two largest firms—Black & Veatch and Burns & McDonnell—saw centrality as a critical growth factor when the a young nation was flexing its engineering muscles, building bridges and water and electrical systems in the late 19th and early 20th centuries.

But atop that long-standing foundation, the region’s biggest engineering firms have boosted employment of professional engineers by nearly 29 percent over the past decade, in spite of the downturn. Leading the way back has been Burns & McDonnell, with 234 more of those positions. Last year alone, the company added about 700 jobs overall, including many licensed and unlicensed engineers, technical and support staff, and expects to add 600 more this year.

It also set a record in 2013 with $2.3 billion in total sales for all business units, as did Black & Veatch, which enjoyed a $300 million increase that brought revenues to $3.6 billion.

Both firms cite backlogs in demand for engineering, construction or architecture work across a wide range of disciplines, including electrical transmission systems, petroleum and petrochemical processing, air-quality control work for power generation plants and water-treatment plants.
John Walter, director of corporate communications for Burns & McDonnell, also attributed aspects of that growth to the employee-ownership dynamic. “People go the extra mile, and that means working harder to provide their clients better services,” he said. “And it means being creative in a ways that build new areas of opportunity for the company and pave the way to make other employee-owners successful.”

The company’s pioneering work in a new service line for project management in power and distribution settings 10 years ago was just one example of that, he said, and it was generating “tremendous growth” across the firm.

The shale gas boom in the U.S. is cited as another factor fueling demand for more processing facilities and pipelines, but spending overall is up for power infrastructure, and because of additional environmental regulation related to water-treatment systems.

Other firms shoring up the ranks of professional engineers in the KC region were Henderson Engineers and TranSystems Corp., adding 74 and 72 engineers, respectively.

Across the Kansas City marketplace, other factors prompting changes have been the appearances of companies like Kiewit Power, the Omaha-based giant with $11.8 billion in 2013 revenues, and New York-based Thornton Tomasetti to the competitive mix. Both opened operations here over the past decade.
All told, roughly 30 of the biggest firms now have 2,450 professional engineers working in the Kansas City market, up from about 1,835 a decade ago.
While growth at the top has been pronounced, firms outside the Top 10—roughly a dozen of them, generally with fewer than 20 professional engineers in 2004—have thinned their combined ranks by 100 over the past decade. Employment there has gone from a combined 257 to 157.

The overall increase in employment market-wide, Walter said, bodes well for the region.

“The fact that the Kansas City area is becoming better-known as an engineering hub—in the same way that Silicon Valley is known as a software-development hub—can only help to raise the profile of the community and it makes it more attractive to outside businesses, new industries and people who can take advantage of that expertise,” he said.