Prior to the beginning of the COVID-19 pandemic, the construction industry was responsible for more than $900 billion to the United States economy solely in the first quarter of 2020. Construction also reached its highest level of employees since 2008 with over 7.64 million people employed. Unfortunately, the abrupt pandemic impacted construction detrimentally causing the industry to lose $60 billion in GDP and having to decrease total jobs by over a million. However, the good news is that there is lots of optimism for construction in the near future. The following is important information to know about the construction industry going into the second half of the year.
Construction In 2021
Adapting To The Impacts Of The Pandemic
Last January, construction employment remained below pre-pandemic levels in all but eight states according to an analysis by the Associated General Contractors (AGC) of America. Florida specifically saw an 11-month job decrease from February 2020 to January 2021. Despite the fact that employment levels were steadily decreasing, Florida saw an employment rebound in recent months and has even gained 3,500 jobs, accounting for a 0.6% increase. It has been a long and bumpy road, but demand for construction projects is finally beginning to rise.
Current Construction Challenges
Although the construction industry should see a steady incline in projects, that doesn’t mean the future looks perfect. Contractors will face many challenges and opportunities throughout 2021. Here is a look at the key challenges for construction companies:
- Increase in price of construction materials: Supply chains were disrupted in all industries due to coronavirus lockdowns, and the price of many construction materials increased from 2020 to 2021. Iron and steel became about 15.6% more expensive in the last year. Also, softwood lumber became 70% more expensive in that same period. This has led to increased prices for both construction companies and consumers. Single-family homes are now $16,000 more expensive due to lumber prices alone.
- Employment remains lower than before: Although the construction industry has recovered over 70% of jobs lost during the pandemic, employment levels are still lower than before. This has made projects more time-consuming and difficult as fewer people are available to work. However, the short-term outlook for construction is promising as summer should drive the demand for construction.
Current Construction Opportunities
With these challenges in mind, it’s important to remember that new opportunities are constantly arising as well. Here are some key opportunities to highlight for construction going forward:
- COVID-19 relief bill: The second COVID-19 relief bill has a total value of $1.9 trillion, and part of the budget can go towards construction projects. The bill introduces $340 million in recovery funds which will be managed by state governments. This relief bill can help incentivize construction projects once again.
- Utilizing technology in projects: Technology was at the forefront of the pandemic. Cloud-based storage and video chats became the norm. However, many companies realized the long-term benefits of using technology. For example, construction projects will begin to utilize wearable sensors and drones in all projects to keep employees as safe as possible. Contractors utilizing these technologies in the future will have an advantage over those stuck in the past.
The recent rise in technology has proved to be successful in many industries. Construction is one of the next industries to start utilizing technology to find innovative ways to complete projects.
Innovative Solutions To Your Construction Needs
If you’re looking for a construction partner with years of experience and the means to implement advanced tools, look no further than Poli Construction. At Poli Construction, our mission is to build a foundation of trust and transparency. We believe that every successful project begins with honesty and communication. For more information on how we can be of service to you, please contact us via our website!