Battered and Bruised, But Still Standing

Lou Cerny says the eye test is all you need when assessing the state of the glass industry in Chicago these days.

“You do see a few cranes here and there,” says Cerny, the vice president and project manager for Chicago-based Arlington Glass, “but four or five years ago, you used to always see 15 cranes anytime you drove through Chicago. You’re lucky to see four or five now.”

Companies in the Midwest, such as Arlington Glass, are finding work in a variety of different project types as the market slowly returns.

Companies in the Midwest, such as Arlington Glass, are finding work in a variety of different project types as the market slowly returns.

Cerny’s unscientific review was pretty much echoed by several other glass companies throughout the Midwest reached during an informal survey by USGlass magazine. With construction figures still nowhere near the robust levels they once enjoyed, glass companies are having to make do with less and be more selective in the projects they take.

The recession hit the construction industry hardest, for the most part taking the glass industry down along with it. The pains are more obvious in regions such as the southeast, but no area of the country was spared the economic malaise, the Midwest included.

Like all others, the Midwest glass industry is slowly picking itself up as the economy improves. As in the case in the southeast, smaller projects such as storefronts and interior glass are more prevalent, even if smaller in scope and payout. Public sector jobs continue to be scarce with continued government reticence making bids more competitive than ever and for a greater sense of urgency for each company involved, Cerny says.

Relief appears slow in coming, according to recently released figures by the Associated General Contractors of America (AGCA). According to the latest AGCA data, total construction spending reached a four-year high, although the industry as a whole continued its spotty recovery. More states posted year-over-year gains, although they were highly concentrated in larger, metropolitan areas.

“We’re definitely seeing more activity in the market now, compared to a couple of years ago,” says Matt Notting, the president of Waterloo, Iowa-based Aluminum Glass Co. Inc.

And there’s ample reason for those in the Midwestern glass industry to remain optimistic.

“Business seems to have taken a little uptick,” Cerny says. “It’s getting better. The numbers still aren’t what they used to be, but it’s getting better.”

Tight budgets and overall uncertainty has meant little demand from the federal and state governments for the kind of large-scale building projects that used to be so prevalent before the recession.

They’ve been replaced by smaller jobs, meaning less new construction projects and more modernization ones in places such as Chicago. Quite simply, it means that clients have found it cheaper and minus the risk to simply fix up their existing buildings rather than build entirely new ones.

Absent, Cerny says, are the big high-rise jobs that he used to drive by every day.

“From what I see right now,” he says, “it seems like most of the high-end work we saw four or five years ago is gone.”

Public construction jobs such as schools and hospitals used to be the bread and butter for Aluminum Glass, but the recession changed all that, Notting says. It just wasn’t prudent business to tie up valuable time and resources when so many companies were struggling to keep their own lights on, let alone pay their bills on time.

So Notting plotted a new course and his company has continued to fare well following the decision to assume less-risky strip mall projects that were nearby and much more prevalent in nature. The company is also doing work in installing smaller glass shower enclosures to help make ends meet and is also carrying less inventory than in the past.

Notting remains confident things will continue picking up industry-wide.

“I think there’s a lot of optimism,” he says. “I hope to think we’ll continue at the rate we’re going.”

To learn more about how the Midwest glass industry is faring, look for the second part of our regional series in the October 2013 USGlass.

 

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