Commercial construction faces a rocky year but skilled workers are still needed

Mitchell Hartman Apr 20, 2021
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Study says any ramp-up in big and expensive projects will lag the overall economic recovery. Sean Gallup/Getty Images

Commercial construction faces a rocky year but skilled workers are still needed

Mitchell Hartman Apr 20, 2021
Heard on:
Study says any ramp-up in big and expensive projects will lag the overall economic recovery. Sean Gallup/Getty Images
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One sector that’s done alright through the pandemic is construction, with homebuilding on a tear, home prices soaring, and lots of people relocating as they discovered they can work from any place with good internet.

What is not recovering quite so well within that sector is commercial construction. That covers pretty much anything that’s not a house or apartment. A new report out Tuesday from the Associated General Contractors of America and construction-management software firm Procore, confirmed this.

“Nonresidential contractors—many of them are seeing projects postponed or cancelled, and their order books are shriveling fast,” said Ken Simonson, chief economist at the Associated General Contractors of America.

Commercial construction employment is still down about 5% from before the pandemic, and Simonson said any ramp-up in big and expensive projects will lag the overall economic recovery.

“Whether they are businesses that have planned to add another store or restaurant, a university that has suddenly seen a huge loss of students, project owners are facing deficits, a lot of uncertainty that they’ll still need a new facility.”

That is especially true for owners of office and retail real estate, said Guy Cecala at Inside Mortgage Finance. “You know, everybody working remotely, most companies wanted to redo their leases and some of them just walked away from it,” he said.

But the pandemic drag on commercial building does not appear to be dampening demand for skilled construction workers.

Mary Ann Naylor with Oregon Tradeswomen, which trains women for construction jobs, said, “there’s huge demand for our graduates.”

She added that the industry is experiencing a “silver tsunami” of older male workers retiring, “we are seeing some women displaced out of the economy lately coming to the trades. There’s a little more security, and the pay is definitely higher.”

If President Joe Biden’s infrastructure plan passes Congress, that will boost commercial construction, but it will take a while for those projects to get off the ground. 

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