Construction Industry Trends: August 2020 Roundup

As the COVID pandemic continues to impact the construction industry, the number of total construction starts between June and July fell by 7%, with non-building construction starts falling 31% according to a recent report from Dodge Data & Analytics. That latter category includes infrastructure and public works projects, which have for years now been a point of contention on the legislative side as both federal and state infrastructure spending bills have stalled. Though Dodge’s chief economist, Richard Branch, noted the drop isn’t necessarily a huge cause for concern yet. “The gains in the nonresidential and residential sectors mirror the general overall improvements in the economy. The drop in public works could represent a settling back in activity following a solid spring in which some projects broke ground earlier than expected to take advantage of the fewer cars on the road during the COVID-19 shutdown in March and April.”

Anirban Basu, chief economist for Associated Builders and Contractors, told Construction Dive that economic uncertainty associated with COVID could impact the construction industry as a whole for some time. “Unfortunately, circumstances facing the average contractor are likely to deteriorate further as the pandemic lingers and as complete economic recovery proves elusive.” And the longer the pandemic continues, the more funds for public infrastructure projects could dry up. In Chicago for instance, the city’s aldermen were told this month that the city needs $4.4 billion over the next five years to put its streets, bridges, buildings and vehicles on a maintenance-and-replacement cycle, but has funding for only $1.7 billion — a $2.7 billion shortfall.

The Takeaway: No matter how you slice it, the construction industry has seen an economic impact from COVID and a full recovery could still be years away. However, the construction industry is resilient and leading contractors know how to navigate downturns. That’s why many are modernizing their operations with the latest software and technology to boost productivity and profitability - two factors critical to accelerating the industry’s recovery.

In the midst of massive social justice protests across America aimed at ending systemic racism, Construction Dive surveyed its readers as to their own experiences on construction jobsites. In response, 65% said they had witnessed a racist incident ranging from verbal abuse/slurs to the posting or placement of racist symbols. Some 42% said they had seen outwardly racist graffiti at jobsites, while 38% had witnessed racist language used. Twenty five percent reported refusals to hire a worker because of their race, while 31% noted workers being given undesirable tasks due to their race. Meanwhile, 15% of respondents reported seeing nooses or other racist objects placed at or near construction sites. Of these incidents, 70% of respondents said noting was done to address them. In terms of potential reasons for racist acts, readers surmised that everything from high-stress environments to relatively low numbers of minority workers on some jobsites that leave offending groups feeling more emboldened. Regardless, most respondents noted that any racist actions in construction needed to be weeded out.

The Takeaway: These numbers are stunning, yet not surprising. The construction industry, like many others, has faced challenges with diversity and inclusion. Recent years though have seen both industry associations and individual contractors take significant action to stamp out racism, sexism and other blights. And, some good progress has been made on that front. It’s clear though that there is a lot more work to be done. Read about one construction professional’s own experiences with diversity in construction here. And be sure to sign up for Viewpoint’s 2020 Virtual Collaborate Conference (Sept. 22-23), where we’ll have several sessions covering diversity and inclusion.

A team of students from Florida International University beat out 26 other teams to win this year’s honors as winners of the Associated Builders and Contractors annual Construction Management Competition. The contest, as Construction Executive Magazine notes, “gives the nation’s top construction management students a glimpse into the real world of construction.” The project this year’s teams worked on was the construction of a new federal courthouse for the U.S. District Court for the Middle District of Tennessee. Each student team had to plan demolition, construction and site development. The FIU team won first place in the estimating and project management portion of the competition, as well as the overall grand prize. Other winning teams included Montgomery College (quality control), The University of Wisconsin-Platteville (safety) and the University of Cincinnati, which was named “Student Chapter of the Year for outstanding accomplishments in programming, community service, communications/public relations and interaction with its sponsoring ABC chapter.”

The Takeaway: Congrats to all of the winning teams and participants. The Construction Management Competition is one of the industry’s best hands-on educational experiences and it’s great to see so many talented teams competing. It shows that interest in construction careers — especially for those inspired by new ideas and applications of modern construction management technologies — isn’t waning. More programs and experiences like this would be even better! Don’t forget to check out the Viewpoint Construction Award

winners this September at the Viewpoint Collaborate Conference, where some of the most challenging and innovative construction projects will be celebrated!

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