88% of contractors experiencing project delays; 93% say rising materials prices have affected jobs

By Riley SimpsonSeptember 08, 2021

Associated General Contractors of America and Autodesk surveyed 2,136 contractors and firms about the past year of business and their outlook going forward as construction continues its economic recovery

Most contractors are still dealing with rising materials process, project delays and worker shortages, according to the annual Workforce Survey conducted by the Associated General Contractors of America (AGC) and software firm Autodesk.

“Today, firms are worried about finding enough work even as they try to find enough workers,” said AGC CEO Stephen E. Sandherr during a webinar discussing the state of the construction labor market.

AGC Chief Economist Ken Simonson reported that 88% of the survey respondents are experiencing project delays – 75% cite delays due to longer lead times or materials shortages, 57% reported delivery delays, and 61% said that worker shortages caused their delays.

In addition, 93% responded that the rising materials prices have also affected projects.

And although the continuing Covid-19 pandemic has affected prices and supply lines, the survey showed that firms are having as much difficulty filling positions as they did before the pandemic: 89% responded as having difficulty seeking to fill hourly craft positions in both August 2021 and August 2019, and the percentage of respondents having difficulty seeking salaried workers in 2021 (86%) is similar to the figure from 2019 (83%).

“It’s not surprising we’re seeing continued challenges,” said Allison Scott, director of Construction Thought Leadership and Customer Marketing at Autodesk. “The industry is not unique [in that regard], but there are some promising trends.”

Scott pointed to how the construction industry is answering the skilled labor issue, as the survey indicated that 37% of firms have engaged with career-building programs and almost 33% have added online strategies to connect with younger applicants.

She said that some firms are starting to amp up their presence where emerging talent lives (in schools and on social media, for example); others are becoming more flexible to fit the modern workforce.

“Although we’re still in the middle of a labor shortage, it’s good to see the industry branching out into training, professional development and using technology,” Scott said. “It’s a crucial shift that will pay dividends in the long run.”

She included that 57% of respondents reported increased technology adoption over the past 12 months, and almost 60% said they will see that adoption rate increase over the next 12 months.

The most interesting example of recruiting skilled workers might be the partnership between construction apparel brand Carhartt and heavy metal band Metallica.

In addition to firsthand changes that firms are implementing, Sanderr discussed the ways the federal government can help spark the construction industry with policy and political action.

First and foremost is the $1-trillion bipartisan infrastructure bill that the U.S. Senate passed last month, but Sandherr said that investing in career and technical education is essential, too.

According to Sandherr, right now, for every $6 invested in four-year college prep, only $1 goes into career training – despite the notion that only one in three jobs requires a full college degree.

In addition to boosting federal investments, Sandherr called for fewer tariffs on construction materials and fewer restrictive hiring measures.

“Once the pandemic wanes, the demand for construction is sure to rebound and the labor pool is likely to expand,” Sandherr said. “Our goal is for contractors to have plenty of work.”

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