The coronavirus pandemic is causing construction companies to turn to layoffs and furloughs, according to www.constructiondive.com.
As of April 3, 27% of construction firms responding to an online survey conducted by the Associated General Contractors of America said they had furloughed or terminated workers as a result of the COVID-19 pandemic; that number was at 40% by April 10.
Respondent said the furloughs and layoffs are tied to a slowdown in construction work, and 30% of firms said they had been asked by government officials to shut down construction sites. In addition, 53% of respondents said their projects have been delayed by owners, and another 7% said owners had canceled their projects.
The survey found contractors are facing various issues related to COVID-19, including materials shortages, personal protective equipment shortages, potential infected workers, lack of government action and a shortage of craftworkers.
More than 6.6 million Americans filed for unemployment during the past few weeks. Associated Builders and Contractors Chief Economist Anirban Basu said employment reports in upcoming months are likely to be worse. He also said it is unclear how much of the construction employment declines are resulting from mandated suspension of projects in states and how much are because of the emergence of recessionary forces.
“Generally, nonresidential construction is one of the last segments of the economy to enter recession as contractors continue to work down their collective backlog,” Basu said. “The need for social distancing renders that statistic less pertinent, meaning that nonresidential construction is susceptible to large-scale job losses immediately.”
