Nearly two in five contractors report project owners have halted or canceled current construction projects amid deteriorating economic conditions, according to a survey released by the Associated General Contractors of America (AGC). The results of the latest AGC survey indicate the number of project cancellations in the wake of the coronavirus are increasing. A previous survey from the AGC found 28% of contractors had projects delayed or halted as a result of the global health crisis.
AGC officials suggested the increase in project cancellations means massive job losses are likely to be experienced nationwide. The impacts of coronavirus will likely reverse the trend in job growth in construction. In February, the last full month before coronavirus's pronounced impact on the United States, 42 states added construction jobs.
“The abrupt plunge in economic activity is taking a swift and severe toll on construction,” said AGC chief economist Ken Simonson. “The sudden drop in demand stands in sharp contrast to the strong employment levels this industry was experiencing just a few weeks ago.”
In the AGC's newest survey, conducted between March 23 and 26, 45% of the 1,640 respondents reported experiencing project delays or disruptions. Material shortages were reported by nearly a quarter of respondents, and a shortage of craftworkers was reported by 18% of respondents. Sixteen percent of survey participants indicated projects were delayed by shortages of government workers needed for inspections or permits and 13% said delays were caused because a potentially infected person visited a jobsite.
More than a third of respondents said suppliers had contacted them notifying them that deliveries would be delayed or canceled, compared with only 22% from the first AGC survey.
