Resource
EXECUTIVE SUMMARY
The 2025 Q4 Engineering Business Sentiment reveals an industry that continues to demonstrate resilience and optimism despite a shifting economic environment. Current sentiment remains notably strong: firms report high confidence in both their financial position and the engineering and design services industry more broadly, driven in part by sustained demand in top-performing market sectors such as Data Centers and Energy and Utilities. Backlogs remain healthy for many firms, hiring needs persist across the sector, and larger firms in
particular express elevated confidence relative to their smaller counterparts. However, optimism regarding the U.S. economy has softened significantly from the previous quarter, reflecting increasing caution as leaders evaluate national conditions.
Looking ahead, future sentiment is more tempered. While firms expect continued strength in their own financial outlook and gradual improvement in industry conditions, expectations for the U.S. economy have dipped into negative territory. Political uncertainty and broader economic unpredictability dominate the concerns shaping this outlook, along with persistent worries about inflation, tariffs, and the possibility of a recession. Even so, firms project modest growth in backlogs and report strong hiring intentions for the coming year, particularly large firms and those located in the Northeast, suggesting that organizations remain prepared to invest in long-term capacity despite near-term volatility.
This quarter’s “hot topics” provide important context for the workforce and technology environment shaping the sector’s trajectory. Artificial Intelligence (AI) adoption remains early-stage across most firms, characterized largely by limited deployment or exploratory pilot projects rather than full-scale integration. At the same time, leaders express strong support for expanding access to H-1B visas to address ongoing talent shortages, with nearly half of firms already employing visa holders. Yet the near-unanimous negative reaction to a proposed $100,000 per-hire fee illustrates the tension between workforce needs and potential policy barriers that could restrict access to global engineering talent.
Together, these findings portray an industry that remains confident in its operational strength and strategic direction while simultaneously expressing caution about national economic conditions. Firms appear prepared to navigate uncertainty—continuing to hire, exploring emerging technologies, and sustaining strong sector level optimism—even as they call attention to structural challenges such as workforce shortages and the broader macroeconomic climate.
Note: This study was conducted between October 28 and November 10, 2025, during which time the U.S. was experiencing a federal government shutdown.