Sharp jump construction projects being cancelled or delayed says AGC survey

Many jobs are being put at risk as the virus crisis halts construction sites across the U.S. says a new survey out this week from AGC, the Associated General Contractors of America.

“The Coronavirus is taking a swift and severe toll on the industry,” says the association. AGC officials are now calling for “additional measures to help workers and firms recover.”

Four out of ten “contractors report that project owners have halted or cancelled current construction projects amid deteriorating economic conditions,” concludes the survey.

AGC officials warn: “These cancellations mean massive job losses are likely soon unless Congress passes targeted recovery measures to boost infrastructure funding, compensate firms for lost or delayed federally funded work and provide needed pension relief.”

This rapidly developing trend in project cancellations is a complete U-turn from previous data showing that 42 states added construction jobs in February 2020.

“The abrupt plunge in economic activity is taking a swift and severe toll on construction,” said Ken Simonson, the association’s chief economist.

According to Simonson, only 18% 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,” he says.

The survey was conducted between March 23 and 26 2020, when 45% of the 1,640 respondents reported experiencing project delays or disruptions.

Shortages of material, parts and equipment, including vital personal protective equipment for workers such as respirators, were reported by 23% of respondents.

16% said projects are now being delayed by shortages of government workers needed for inspections, permits and other actions.

13% said delay or disruption had occurred because a potentially infected person had visited a jobsite.

The survey also found that 35% of firms said suppliers had notified them or their subcontractors that some deliveries would be delayed or cancelled.

However, despite the rapidly deteriorating situation, the association also released new construction employment data showing that most states – 42 – added construction jobs between February 2019 and February 2020.

Association officials warned that: “Congress must do more to protect high-paying construction jobs.”

AGC wants to see more “investment in infrastructure, relief from losses incurred on delayed or cancelled federally funded projects and protections for multi-employer pensions.”

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,” said Stephen E. Sandherr, the association’s chief executive officer.

“Construction workers and employers need more than a lifeline, they need a recovery plan.”

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