Data is beginning to reflect the ongoing negative impact of the coronavirus (COVID-19) on construction businesses. The Bureau of Labor Statistics’ Employment Situation Summary for March indicates the national unemployment rate rose to 4.4% and residential construction employment decreased by 4,300 in March. On the whole, nationwide nonfarm payroll employment fell by 701,000, the first time since September 2010 that monthly employment growth dropped below zero, according to the National Association of Home Builders’ (NAHB) Eye on Housing blog.
A survey conducted by the Associated General Contractors of America (AGC) between March 30 and April 2 indicates that COVID-19 has forced nearly one in five construction firms to furlough or terminate office and jobsite workers.
“The March unemployment data does a better job reflecting market conditions before the pandemic than it does the widespread disruptions that have occurred during past few weeks,” AGC chief economist Ken Simonson said in prepared statement. The employment figures included in the March data report are based on payrolls as of March 12, just prior to when a variety of states began issuing stay-at-home orders. “Our survey, meanwhile, indicates rapidly deteriorating labor and market conditions for the construction sector.”
Among the 1,294 respondents from 31 states, 16% furloughed or terminated office workers and 3% furloughed or terminated construction workers. The share of firms that said they had been directed to halt or cancel projects by clients increased over 10 percentage points from an AGC survey for the previous week. More than one-quarter of respondents reported they had been directed to stop construction work by government officials.
Nearly three in five firms reported either a shortage of materials, a shortage of craftworkers, or a shortage of government workers needed for inspections and permits caused project delays or disruptions. Around 40% of respondents indicated suppliers said deliveries would be late or canceled.
Almost all respondents indicated they had integrated social distancing guidelines into operations while over 80% said they increased the number of hand washing and sanitizing stations on jobsites. More than three-quarters of firms said they were limiting the number of people on a jobsite below 10 people and increased the frequency of disinfection at high-traffic areas.
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