The pandemic has affected pretty much every industry, even those for which there wasn’t as dramatic a shutdown. While most construction work continued after being designated “essential,” it still didn’t stop the overall fluctuation of the economy during the past year or so.
On the other hand, the overall outlook is brighter now that COVID-19 vaccines are available to the general public and more businesses are re-opening. One sector that is feeling this renewed sense of optimism is commercial construction.
According to an article in Contractor Magazine, the national Chamber of Commerce’s Commercial Construction index indicates that more contractors are planning to invest in equipment and human resources.
Feeling better about the industry
The stats from the Chamber reflect the first quarter of this year. There was a big jump with the question of revenue expectations, moving from 25% confidence of an increase in Q4 of last year to 36% for Q1 2021. For hiring, it’s also a leap — this time, it’s from 37% in Q4 ’20 to 46% in Q1 ’21. Not only that, only 3% reported they plan to reduce staffing.
Why the rosy outlook? The chief policy officer of the U.S. Chamber, Neil Bradley, said in the article that the vaccine roll-out was a crucial signpost that things are turning around. At the same time, there is one aspect that does give pause to some in the industry: finding skilled workers, an issue before COVID-19 appeared on the horizon.
“While it has remained a chronic problem over the last year, heightened concern may be emerging again as contractors look to hire,” Bradley said. “The U.S. Chamber is committed to supporting businesses in retraining and making sure the economy has the skilled workforce it needs.”
Challenges remain
The survey of contractors found some other concerns, although none completely tempered the optimism for better times ahead. There are material shortages. For instance, 22% of those surveyed said they experienced lumber shortages. Though that is down from 31% at the end of 2020. Steel is just at 14%, while pipe or PVC is 10%. There are also concerns about tariffs on steel and aluminum, which 35% of contractors say will have an impact.
Still, other indicators speak more to the optimistic side of things. For instance, 37% of contractors say they plan to increase equipment and tool expenses. And the overall level of contractor confidence is at a score of 59, up another two points from Q4 ’20.
While it may seem slow to awaken, it’s clear that the economy overall is starting to trend up, and construction will be no exception. As Chamber leader Bradley points out: “Rising optimism in the commercial construction industry is a positive sign for the broader economy.”
Craftco is also poised to help meet this increase in demand for welding and machining, for worksites large and small. To find out more about what we have to offer, visit our website.