A survey conducted by the Associated General Contractors of America says more than one-quarter of member firms in the U.S. have already halted or delayed work on projects due to COVID-19, while only 11% of firms report possible delays in jobs scheduled to start a month or more out.
The online survey, conducted by the association between March 17 and 19, reveals that 28% of the 909 respondents said they have had an owner, government agency or official tell them to halt or delay work on active projects or on jobs expected to start within a month. In addition, 22% of respondents said a supplier had notified them that deliveries would be late or cancelled.
“The coronavirus pandemic has the potential to undermine what had been a very robust construction market, threatening the livelihood of countless workers and the viability of many firms,” said Ken Simonson, the association’s chief economist, in a statement.
Contractors listed numerous types of delays and shortages. Nearly one out of five cited shortages of required government actions or personnel, including the ability to issue permits and certificates of occupancy, conduct inspections and lettings and make project awards.
Shortages of materials, parts or equipment, including workers’ personal protective equipment such as respirators, was reported by 16% of members; and 11% reported a lack of craft workers as individuals self-quarantine or stay home to care for others.
AGC announced its findings on March 20 during the first in a series of eight webinars designed to help assist its members with navigating the fast-changing economic landscape of the past few weeks. The webinars will be offered daily beginning March 23.
More Work Stoppages Ahead
“We expect that more government agencies will order projects to be halted in the near future,” Simonson told attendees to the March 20 webinar.
AGC officials said the survey—which they will repeat in the coming week—and the growing work stoppage of projects are driving an immediate need to get information to contractors. Main areas of concern include paid sick and family medical leave, tax credits, recordkeeping, insurance and contractual provisions and evolving OSHA requirements. The upcoming webinars will address one topic per day.
Association officials noted on March 20 that a relief bill under consideration in the Senate includes some favorable tax and loan provisions for firms. But they also said the bill needs to clarify several key issues.
“Providing additional tax credits and loans will help, but contractors also need the certainty that comes with infrastructure funding and improvements to the new paid and family leave measures,” Simonson said.
Other issues include missed payments by owners, materials prices and delays, and increased pressure from insurers and owners about worker protection.
“Many owners are seeking reassurances that contractors are taking the necessary steps to protect workers,” said AGC general counsel Mike Kennedy. “Contractors need to put in place appropriate measures to protect everyone on your sites.”
Construction as an Essential Activity
AGC leaders also are pushing Congress and the administration to designate construction as an “essential activity” as further workplace restrictions are enacted.
“For now, the federal government has put out a notice of what tasks and industries are considered essential,” said AGC CEO Steve Sandherr. “And construction is on most of those lists, but we are seeking clarification on that.”
He added: “On a positive note, most states are moving forward with projects,” but he cautioned that may not always be the case. That’s why AGC is working on a statement to states about why construction should continue, including the fact that it’s much easier for construction firms with active workers to respond to natural disasters should that be necessary, he said.
“The Senate proposal offers a good start to helping offset the sudden drop-off in work many contractors are experiencing,” Sandherr said. “But without real investments in new infrastructure, compensation for contractors’ lost work and up-front funding for paid sick and family medical leave, it does too little to help the industry and its nearly eight million employees.”
AGC webinars are available free to members and for a fee to non-members, via the association's continually updated coronavirus page.
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