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Survey: Skilled Labor Shortage Still Present in Pandemic

Wednesday, September 9, 2020

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Despite project delays and cancellations due to the COVID-19 pandemic, a new survey finds that demand for skilled laborers is still high, according to the Associated General Contractors of America.

“Few firms have survived unscathed from the pandemic amid widespread project delays and cancellations,” said Ken Simonson, the association’s chief economist. “Ironically, even as the pandemic undermines demand for construction services, it is reinforcing conditions that have historically made it hard for many firms to find qualified craft workers to hire.”

The survey was conducted Aug. 4-26. More than 2,000 firms completed the survey from a cross-section of the construction industry, including union and open shop firms of all sizes.

The Research

According to the survey from the AGC and Autodesk, 60% of responding firms reported having at least one future project postponed or canceled because of COVID-19, while 33% report having projects that were already underway halted because of the pandemic.

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Despite project delays and cancellations due to the COVID-19 pandemic, a new survey finds that demand for skilled laborers is still high, according to the Associated General Contractors of America.

(The share of firms reporting canceled projects has nearly doubled since the survey AGC conducted in June, when 32% of respondents reported cancellations.)

At the same time, 44% of responding firms reported that it has taken longer to complete projects and 32% say it has cost more to complete ongoing projects because of the pandemic. As a result, 40% reported they have adopted new hardware or software to alleviate labor shortages.

A breakdown of firms by revenue of those who have reported postponed or canceled projects includes:

  • 56% of firms with revenues of $50 million or less report a project has been postponed or canceled;
  • 71% of midsized firms (revenue of $50.1-500 million); and
  • 69% of large firms (revenue exceeding $500 million).

“The results of the AGC and Autodesk workforce study reveal that the construction industry is still grappling with the changes and consequences of the coronavirus pandemic,” said Allison Scott, director of construction thought leadership and customer marketing at Autodesk.

“The long-term effects of the current crisis have yet to play out, and firms that double down on innovation efforts, whether an increased focus on lean construction, workforce training or technology that facilitates remote collaboration, will be well poised for enduring resilience.”

In terms of skilled labor, those statistics differ by project type and revenue size. For instance:

  • Highway and transportation contractors report the greatest difficulty in filling hourly craft positions, with nearly 73% reporting an unfilled craft position on June 30; and
  • About 69% of utility infrastructure and federal and heavy construction firms had unfilled craft positions the, as well as 58% of building construction firms.

In addition:

  • 52% of all respondents report having a hard time filling some or all hourly craft positions;
  • 60% of firms had at least one unfilled hourly craft position as of June 30; and
  • 28% of respondents report difficulty filling salaried positions.

While a third of firms furloughed or terminated employees as a result of the pandemic and ensuing shutdowns, not all laid-off workers want to return to work. The survey found that 44% of firms that recalled employees said that some have refused to return citing a preference for unemployment benefits, virus concerns, family responsibilities and other reasons.

In relation, 38% of firms reported increasing base pay rates to attract and retain workers, while 3% of firms reduced pay.

The latest survey also asked firms to identify measures from the federal government that would help the industry. Those responses included:

  • 55% said they were looking to Congress to increase funding for all forms of public infrastructure and facilities;
  • 53% want Congress and the Trump administration to enact liability reforms to “shield companies who are protecting workers from the coronavirus from needless lawsuits”; and
  • 41% want Congress to address unemployment benefits “that serve as artificial barriers to returning people to work.”

“There is a lot that Washington officials can do to help boost demand for construction projects and get more people back to work rebuilding the economy,” said Stephen E. Sandherr, the AGC’s CEO, noting the association was pushing Congress and the administration to enact new recovery measures. “The challenge is that the coronavirus has put many contractors in the position of looking for work and workers at the same time.”

Recent Numbers

The AGC released data at the end of last month detailing job cancellations and employment numbers by state.

From June to July, the states with the highest decline—either by amount of jobs or percentage—included:

  • California (-14,800 jobs or -1.7%);
  • Texas (-6,300 jobs, -0.8%);
  • New Mexico (-2,900 jobs, -5.9%); and
  • Vermont (-400 jobs, -3.7%).

However, within the past month, 24 states have increased employment. Those states include:

  • New York (13,600 jobs, 4.0%); and
  • Missouri (4,400 jobs, 3.5%).

Year-over-year numbers, however, paint a different picture, as employment has declined in 39 states, including:

  • California (-55,800 jobs, -6.3%);
  • New York (-50,700 jobs, -12.5%); and
  • Vermont had the worst percentage decline (-4,800 jobs, -31.6%).

That scope’s upswing includes 10 states that increased jobs year-over-year. Those include:

  • Utah (8,600 jobs, 7.8%);
  • Maryland (4,900 jobs, 3.0%); and
  • South Dakota (2,500 jobs, 10.5%).

   

Tagged categories: Associated General Contractors (AGC); COVID-19; Economy; Good Technical Practice; Industry surveys; Jobs; NA; North America

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