With lockdown rules keeping people home and the media and politicians selling heavy daily doses of COVID Case hysteria, the construction industry will slump this year.
While new home construction is up, most other sectors of the construction industry are languishing as clients delay construction in the face of an uncertain economy, according to a survey released 7 January by the Associated General Contractors of America (AGCA).
“Demand looks likely to continue shrinking, projects are getting delayed or canceled, productivity is declining, and few firms plan to expand their headcount,” AGCA CEO Stephen Sandherr said in a statement accompanying the survey results.
In 13 of 16 construction categories surveyed, builders expect markets to contract.
Lodging and office construction earned an outlook of -58, higher education -40, public buildings -38, and K-12 schools -27.
Two sectors that rated positively are seen as tied to efforts to vanquish the COVID virus: warehousing +4 and medical clinics and labs +11.
Fifty-nine percent of survey respondents said they had projects postponed from 2020 into this year; 43 percent had projects postponed last year that have not been rescheduled.
Eighteen percent of builders had projects scheduled to start between now and June that have been put off, and 8 percent had projects planned for that time period that now have been canceled altogether.
A third of companies said business has matched or beaten last year’s levels, with 12 percent seeing their work returning to pre-pandemic levels by July. Fifty-five percent think their business will take longer than six months to recover or are unwilling to say when business will return to normal.
Thirty-five percent of companies expect to add workers this year, 24 percent will lay off employees, and 41 percent will make no changes to their payrolls.
Among builders in southern states, 39 percent expect to add workers, while 17 percent do not. In the Northeast, 41 percent plan to cut workers; less than a quarter will expand their payrolls.
Restrictions on social movement are forcing projects to take longer to complete according to 64 percent of companies, with 54 percent saying projects are costing more due to the strictures.
