Construction Disruptions Compounded by Workforce Issues: AGC Survey

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Although the COVID-19 pandemic has forced the construction industry to contend with project delays and cancellations, most firms have difficulty finding enough skilled workers, according to the most recent survey conducted by the Associated General Contractors of America and Autodesk.

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Ken Simonson, AGC’s chief economist, noted in a prepared statement that, “Ironically, even as the pandemic undermines demand for construction services, it is reinforcing conditions that have historically made it hard for many firms to find qualified craft workers to hire.”

Sixty percent of the 2,000-plus firms that responded reported having at least one future project postponed or cancelled because of the coronavirus, and 33 percent reported having underway projects halted for the same reason. That 60 percent figure is nearly double the 32 percent found in a June survey by AGC.  

Ken Simonson, Chief Economist, Associated General Contractors of America. Image courtesy of Associated General Contractors of America

The pandemic has also hurt the construction sector’s productivity level, because of the measures contractors have had to take to protect workers and the public from COVID-19. Forty-four percent of the responding firms stated that it has taken longer to complete projects, and 32 percent referenced higher costs to complete ongoing projects because of the coronavirus.

Overall, there’s a substantial degree of caution about future demand for construction projects. Just 42 percent of firms reported that their volume of business has returned to the levels of 12 months ago or that they expect it to return within the next six months, versus 52 percent in the June survey.

Labor force issues 

About one-third of responding firms have furloughed or terminated employees as a result of the pandemic and government shutdown orders or decisions by project owners, though most of those companies have asked at least some laid-off workers to return to work.

However, 44 percent of firms that recalled employees reported that some have refused to return, citing a preference for unemployment benefits, concerns about the virus or family responsibilities, among other reasons.

The pandemic has also made it difficult for many firms to fill open positions, especially for hourly craft jobs. About half (52 percent) of respondents reported having a hard time filling some or all hourly craft positions, especially those for laborers, carpenters and equipment operators. Sixty percent of firms had at least one unfilled hourly craft position as of the end of June. 

Tellingly, perhaps, the survey found that union firms are having less difficulty filling positions than open-shop employers. Forty-three percent of firms that exclusively use union craft labor reported difficulty filling hourly craft positions, versus 63 percent of firms that use only nonunion labor.

Read the full report on Associated General Contractors of America’s website.