Source: Construction Global by Fran Roberts
Commercial construction is in high demand across the US and contractors remain optimistic about the current and forward-looking health of the sector, according to the Q3 USG Corporation and US Chamber of Commerce Commercial Construction Index.
Nearly all contractors surveyed this summer (95%) expect revenues to grow or remain stable over the next 12 months compared to the prior 12 months, continuing Q2 2017 survey sentiments.
93% of contractors also expect to see profit margins stay the same or increase in the next 12 months, reflecting healthy contractor sentiment.
Despite contractors’ expectations for growth, access to talent continues to pose challenges in the third quarter of 2017, with 60% of contractors having difficulty finding skilled workers, compared to 61% in Q2.
Nearly all contractors (91%) said they are at least moderately concerned about the skill level of the workforce, with 66% of contractors in the South expressing concerns about the availability of skilled labour.
“Our biggest problem right now is getting trade manpower to build the various elements of the projects and that’s typical throughout the US,” said Bill Lonigan, Senior Project Manager at DavisREED Construction, in an exclusive interview with Construction Global.
“Everybody is just stretched to the limit for lack of manpower. As far as production for products, we haven’t noticed any shortages yet on any kind of materials to date but manpower has definitely been our biggest challenge.”
The Index release comes on the heels of Hurricanes Harvey and Irma, which are expected to exacerbate existing concerns about labour shortages in the South.
Cost estimates for Harvey and Irma destruction are US$290bn, according to AccuWeather.
Irma caused US$100bn in damages (although other estimates that exclude Puerto Rico and the US Virgin Islands put the cost closer to US$50bn), while Harvey damages will cost an estimated US$190bn to repair.
“The Commercial Construction Index is unique in providing the contractor’s view of the state of the industry, which is a key driver of the US economy,” said Jennifer Scanlon, President and Chief Executive Officer of Chicago-based USG.
“This quarter’s findings reveal strong optimism about future prospects for the industry, and also highlight a real need to address ongoing concerns about skilled labour shortages and the impact it has on building in the US.”