A large share of contractors in Colorado and across the country reported having had projects postponed or canceled because of the pandemic, and the construction industry has shed more than 400,000 jobs nationally since March.
Despite that, many firms say they continue to struggle with labor shortages, especially for skilled laborers, according to a new workforce survey from the Associated General Contractors of America and Autodesk.
“Ironically, even as the pandemic undermines demand for construction services, it is reinforcing conditions that have historically made it hard for many firms to find qualified craft workers to hire,” said Ken Simonson, the association’s chief economist.
In a survey of more than 2,000 firms, a third report having had a project underway halted and 60% report future projects either canceled or delayed because of the pandemic. Even with that reduction, more than half of firms report they continue to struggle to find enough skilled craft workers.
Worker shortages have plagued construction firms for several years now. But some of the new reasons firms cite for shortages are fears among older workers of catching COVID-19, and a preference by some furloughed workers to collect additional federal unemployment benefits, which expired in July.
Firms in Colorado, which considered construction an essential activity during the pandemic, are doing better than the national average in filling jobs. About 44% of Colorado contractors surveyed described having a hard time filling positions compared to 52% of firms nationally. Among the most severe shortages reported in Colorado were for general laborers, carpenters and concrete workers.
About 38% of Colorado contractors surveyed either furloughed or terminated workers during the pandemic, while 25% continued to hire. About a quarter of the firms that sidelined workers reported having problems getting them to come back.
There were 228,300 unemployed workers in July in Colorado. Why not take all those idled hotel and restaurant employees and put them on the job site at a higher wage than what they were making? It’s not so easy, contractors say. For starters, some of the skilled trades take years to master. And even the general labor positions in construction require a certain level of fortitude.
“It is the nature of the work, it is hard labor,” said Dave Little, chief business development officer for Wolcott-based masonry firm Gallegos Corp. Little estimates the firm could use another 30 workers to keep up with contracts on higher-end custom homes in Denver and Aspen and other locations.
Byron Haselden, CEO and president Haselden Construction in Centennial, said his firm tried to hire out-of-work restaurant cooks and they have struggled. It has fared better with displaced oil and gas workers. But there is also less pressure than in prior years to staff up right now. Clients, concerned about the upcoming election, have backed off and the pipeline of future projects is starting to thin.
“We are burning off a lot of the backlog. I’m more concerned about 2021,” he said.
Little also is less optimistic as he looks ahead.
“We are at the tail end of it. If we don’t see some starts happening, there will be some major impacts,” he said.
That uncertainty about what comes next for the construction industry could also be keeping some potential workers away. Absent an infusion of federal assistance, which the industry is lobbying for, public works projects are likely to get cut as local and state governments and school districts cope with revenue shortfalls. Less driving has reduced taxes on gasoline sales, leaving the federal trust fund used for transportation projects nearly empty.
Hotels struggle with high vacancy rates and brick-and-mortar retail space is oversupplied, reducing demand for commercial buildings. Remote working has even made offices redundant. Renovation work continues on office buildings, primarily to prepare them for sale, according to a news call the AGC held.
About the only pockets of strength are single-family residential and suburban apartment construction, although contractors said they have yet to see workers shift from the commercial to the residential side. Demand remains strong for distribution facilities and for data centers.
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