With COVID-19, the Construction Industry Looks Forward with Optimism
The impacts of the COVID-19 pandemic may be raging on, but many indicators in the construction industry give plenty of reasons for optimism. It’s no surprise that throughout 2020, the construction industry – from manufacturer through dealer through contractor – experienced a perfect storm of disruptions. The grim reality is that many of these challenges continue to plague the industry for the time being. A recent ForConstructionPros article notes that as of September 2020, 85% of contractors were still seeing project delays directly related to coronavirus, and a significant portion expect these delays to continue into early 2021. And continuing COVID-19 cases are “causing a growing number of construction projects to be canceled or delayed” according to the Associated General Contractors of America.
However, silver linings abound. The U.S. Bureau of Labor Statistics reports that the construction industry added 84,000 jobs in October, with heavy and civil engineering construction adding 19,000 net new positions each. Confidence in project starts also remains high: 82% of contractors show moderate to high certainty that the U.S. construction market will offer adequate new business opportunities in the next 12 months, up from 75% in Q2 2020.
One of the key areas that we see positive movement toward recovery is in productivity gains. Although challenges will likely remain in the coming year, we’ve found that the pandemic has moved contractors to become more efficient, despite initially decreased productivity. Adoption of technology and data has increased, advancing the construction industry into a better position to negotiate with suppliers and weather future downturns.
Backlog levels also seem to be improving, particularly for civil contractors. According to ForConstructionPros, although the ratio of current–to–ideal backlog has lowered somewhat, most civil contractors “still have backlog levels very close to their ideal amount, even after the impact of the pandemic has been felt for several months.”
The bottom line? Many of the perceived challenges from COVID-19 appear to be lessening over the past few months. Several MagikMe Equipment customers have noted that although there were some COVID-related work delays in Q1 and Q2 2020, they are generally busy and in-demand – these customers acknowledged that the future is slightly uncertain due to uncertainties in state funding, stimulus packages, and the presidential election, but share confidence that the market appears to be fairly solid. Optimism remains high for the future – with over half of civil contractors in one study indicating high prospects for finding new work.
To help address the changing landscape and navigate disruptive changes, MagikMe Equipment provides critical data built from comprehensive feedback from construction executives and industry sources.
To learn more about how we can help optimize data and improve decision-making with better data across your organization, reach out to us by phone at (888) 307-1717, or click below to schedule a demo:
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Keith Tyson
Brand Marketing, MagikMe Equipment
[email protected]
