US construction firms predict strong 2022

By Andy Brown13 January 2022

Contractors expect construction to grow in the US in 2022. Picture @Adobe Stock

Construction contractors in the US expect to add workers this year due to increasing demand for projects, despite ongoing supply chain and worker challenges, according to survey results released by the Associated General Contractors of America (AGC) and Sage.

Optimism about growing demand for many types of construction projects means most firms plan to hire workers this year. Over 70% of respondents expect their firms will increase headcount in 2022, compared to just 9%  expecting a decrease.

The survey also revealed that 22% said their employee numbers would grow by 11-25%, and 5% expected the number to increase by more than a quarter.

While firms are looking to hire, finding available workers is proving to be a challenge. The survey found that 83% of respondents are having a hard time filling some or all salaried or hourly craft positions, compared to only 8% who say they are having no difficulty. The vast majority think it will continue to be hard to hire or will become harder to hire this year.

“Contractors are, overall, very optimistic about the outlook for the construction industry in 2022,” said Stephen E. Sandherr, the association’s chief executive officer. “While contractors face challenges this year, most of those will be centered on the need to keep pace with growing demand for construction projects.”

The Covid-19 pandemic continues to impact the construction industry, with 84% of respondents reporting costs have been higher than anticipated, while 72% say projects have taken longer than anticipated because of the pandemic. As a result, 69% have put higher prices into bids or contracts, while 44% have specified longer completion times.

Supply chain bottlenecks are also impacting construction with just 10% of firms saying they have not had any significant supply chain problems. Just over 60% have turned to alternative suppliers for materials and 48% have specified alternative materials or products.

Rising construction costs and slowing schedules have contributed to a significant number of project delays and cancellations. Just under half of contractors report having a project delayed in 2021 but rescheduled, while 32% had a project postponed or cancelled that has not been rescheduled.

“The last two years have become increasingly unpredictable, due in large part to the coronavirus and public officials’ varied reactions to it,” said Ken Simonson, the association’s chief economist. “But, assuming current trends hold, 2022 should be a relatively strong year for the construction industry.”

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