Survey Says Construction Companies Are Facing a Tough Year

Whether the Covid-19 pandemic tenaciously holds on in the months ahead or even decreases, contractors say they expect the duration of 2021 to be one of the industry’s toughest on record.

This is among the findings of a new survey completed by the Associated General Contractors of America revealing particularly pessimistic feelings regarding the lodging and retail construction segments.

The report, The Pandemic’s Growing Impact on the Construction Industry, additionally reveals that contractors in 13 out of 16 market categories expect less business rather than more in 2021.

Other categories with what the AGC defines as a “negative net reading” include higher education construction; public building construction; and K-12 school construction.

On the positive net reading side is the clinics, medical labs and testing facilities segment, expected to be up by a big 11% in the next 12 months; and the warehouse category, forecast for a 4% increase this year,

Noting the long-range impact of the pandemic, the report notes that 59% of responding firms said projects scheduled to launch last year have been postponed for some time later this year. In a separate finding, a troubling 44% reported that projects cancelled in 2020 have not been rescheduled.

“Few firms expect the industry will recover to pre-pandemic levels soon,” the AGC report continues, although around one third of the responding companies said their business had either returned to pre-pandemic levels, or exceeded those levels.

Meanwhile, a challenge confronting construction companies well before the Covid-19 onset--finding qualified workers--remains mostly unchanged.

With 35% of respondents planning to add staff in 2021, contractors say getting the right worker for the right job is still a big deal. “The unfortunate fact is too few of the newly unemployed are considering construction careers, despite the high pay and significant opportunities for advancement,” noted Ken Simonson, chief economist with the AGC.
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“The pandemic is also undermining construction productivity as contractors make significant changes to project staffing to protect workers and communities from the virus,” added Simonson.

​By Garry Boulard

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