Nearly 40% of U.S. firms have been forced to lay off employees because of project cancellations and shortages of equipment or materials caused by the COVID-19 pandemic, according to an online survey released April 10 by the Associated General Contractors of America.
“Owners are not only halting many current construction projects but are canceling a growing number of projects that have not yet started,” said Ken Simonson, AGC chief economist. “Inevitably, that has caused a growing number of contractors to furlough or terminate jobsite workers.”
Simonson said that 53% of firms report being directed to cancel current projects or ones scheduled to start within the next 30 days. The survey, conducted from April 6 – 9, also said that 74% of firms are seeking help from the new federal Paycheck Protection Program loans.
The latest survey revealed a steep increase in the share of firms reporting that an owner had canceled an upcoming project—up to 19% from 7% the week before. In a question asked for the first time, 11% of the survey’s 830 respondents reported that an owner had canceled a project while it was still in preconstruction.
A previous survey conducted by the association between March 17 and 19, revealed that only 28% of the 909 respondents said they 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.
AGC also reported that 39% of respondents in the latest survey said they had encountered project delays or disruptions due to shortages of personal protective equipment such as masks for jobsite workers, while 23% reported shortages of construction materials, equipment or parts.
In AGC’s previous survey, which had combined those questions, only about one-third (35%) of firms reported equipment shortages.
The share of firms that reported furloughs or terminations rose to 40% from 31% a week earlier. More than one out of three (36%) said they had had furloughed or terminated jobsite workers, while 18% had laid off office or other workers.