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Contractors report project delays, cancellations, supply disruptions

Source: Associated General Contractors of America, Washington, D.C. 

Of the nearly 1,650 contractor participants in an online survey gauging market activity amid federal, state and local pandemic response measures, 39 percent note that owners have halted or canceled current construction projects, while 23 percent cite material, part or equipment shortages, including respirators and other protective gear. 

The late-March AGC survey also finds 18 percent of respondents reporting craftworker shortages; 16 percent encountering delays stemming from the absence of government representatives needed for inspections, permits and other actions; and, 13 percent noting project delay or disruption attributable to a site visit by a potentially infected individual. Thirty-five percent of respondents indicate suppliers had notified them or their subcontractors that some deliveries would be delayed or canceled, a figure up 13 points from an AGC survey conducted 10 days prior. Nearly 10 percent of contractors participating in the most recent survey cite the addition of new work to expand health care and other facilities as public agencies and private providers address the growing coronavirus threat.  

“The abrupt plunge in economic activity is taking a swift and severe toll on construction,” says AGC Chief Economist Ken Simonson, noting that only 18 percent of respondents have been ordered to halt work by elected officials. “The sudden drop in demand stands in sharp contrast to the strong employment levels this industry was experiencing just a few weeks ago.” 

Association officials contend that new investments in infrastructure, relief from losses incurred on delayed or canceled federally funded projects, and protections for multi-employer pension plans will help the industry recover from the economic impacts of the pandemic. “The steps firms are taking to protect workers from the coronavirus unfortunately won’t be enough to save many of them from the economic damage the pandemic is creating,” observes AGC CEO Stephen Sandherr. “Construction workers and employers need more than a lifeline, they need a recovery plan.”

 

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