An increasing number of contractors are reporting cancellations of upcoming projects and shortages of equipment and materials as the effects of the coronavirus (COVID-19) pandemic become more widespread, according to the Associated General Contractors of America (AGC). An AGC survey conducted between April 6 and 9 reports nearly 40% of firms have been forced to lay off employees. As a result of the financial burden, three-quarters of respondents report seeking Paycheck Protection Program (PPP) loans to help mitigate the impact on their business.
“Owners are not only halting many current construction projects but are canceling a growing number of projects that have not yet started,” AGC chief economist Ken Simonson said. “Inevitably, that has caused a growing number of contractors to furlough or terminate jobsite workers.”
The survey finds 53% of the 830 respondents have been directed to cancel current projects scheduled to start within 30 days. Around one in five reported owners cancelling upcoming projects, a significant increase from the AGC's survey a week prior.
Around two in five respondents reported they encountered project delays or disruptions due to shortages of personal protective equipment, while a quarter of respondents reported shortages of construction materials and craftworkers.
The survey indicated 36% of responding firms furloughed or terminated jobsite workers and a further 18% furloughed or terminated office workers. Three in five responding firms reported no changes in their company's headcount.
While 75% of respondents said they had applied or intend to apply for PPP loans, only 10% said they had already received a loan through the program. Almost half of the respondents indicated they wanted Congress to increase the funding for the federal loan program given widespread demand.
