Dodge Data & Analytics teamed up with Viewpoint to host a virtual event on May 18, 2021, the “Connected Construction at Work” conference. The conference offered an overlook of changes due to the COVID-19 pandemic, as well as an overview for the future of construction.
Steve Jones, senior director of industry insights and research for Dodge Data & Analytics, revealed a number of key data points during the conference.
- While total project starts dropped by 9% in 2020 due to the pandemic, it was still just a blip when compared with the dropoffs experienced during the mid- to late-2000’s recession (13% in 2008 and 24% in 2009).
- Though U.S. commercial building starts dropped 24% in 2020, forecasts project a 6% jump in 2021 and a 10% increase for 2022.
- Thanks to the popularity of e-commerce, warehouse building starts were up 6% in 2020 and will continue to grow in 2021 (8% forecasted growth) and 2022 (7% forecasted growth)—led by an $8.8 billion investment by Amazon.
- Office building starts, down 22% in 2020, are expected to rebound by 8% this year and another 10% in 2022, led by a 40% bump in data center construction in 2021.
- Despite a 12% decline in nonbuilding starts (largely heavy highway and civil construction) in 2020, those project starts are expected to increase by 5% in 2021 and an additional 6% in 2022.
Jones says that Dodge is forecasting a 4% bump in 2021 and an 8% increase in 2022.
Dodge’s Commercial Construction Index, revealed at the conference, also includes these revelations:
- Labor is still a key industry challenge, with 85% of contractors reporting moderate to high difficulty in finding skilled workers and 83% of contractors expecting the situation to stay the same or worsen over the next six months.
- The costs and availability of construction materials is another key area of concern, with 82% of contractors noting that fluctuating expenses have had a moderate to high impact on their business and 71% of contractors noting they had faced material shortages.
- The COVID-19 pandemic is still having an impact on work, with 80% of contractors noting project delays and 58% considering worker health and safety to be one of their top priorities.
Viewpoint’s Quarterly Construction Metric Index is also largely positive. Conclusions include:
- Though project backlogs — a key indicator of contractors’ business health — were down in 2020, they are showing a rebound in 2021, with more than 26,000 projects backlogged in Q1 2021 among Viewpoint solution users.
- Heavy highway saw a 10% increase in pending projects in March 2021 as compared to the year before, potentially signaling a rebound for the vertical.
- Backlogs for general contractors have largely been holding strong, though there are still about 10% fewer pending projects in Q1 2021 as compared to Q1 2020.
- Specialty contractors had 25-30% less pending jobs in January and February of 2021 as compared to the same time period in 2020.
- Contract values have largely been holding steady since October 2020, which relates to backlogs starting to build back out.
- Net hiring has been positive in Q1 2021, though hiring is still down more than 40% from what it was a year ago; some regional areas though are showing a hiring boom, with contractors in the Southeast leading the way with a 103% increase in new hires.
Click here for a full summary of the conference, as well as access to recordings.
