An increasing number of construction contractors are laying off employees while architecture firms are reporting fewer new design projects due to impacts of the COVID-19 pandemic. That’s according to separate surveys conducted by the Associated General Contractors (AGC) of America and the American Institute of Architects (AIA).
According to the AGC’s survey of its members conducted April 6-9, 36% of firms have furloughed or terminated jobsite workers as a result of project delays or cancellations. However, 58% of firms reported no change in jobsite headcounts. Eighteen percent of respondents have furloughed or terminated office or other workers.
Federal, state or local agencies have ordered 35% of firms surveyed to halt or cancel construction of current projects or projects scheduled to start in the next 30 days. Government mandates aren’t the only thing stopping work; 41% of firms surveyed reported that an owner has directed them to halt a current project while 19% have had a current or upcoming project canceled.
Many construction firms are experiencing project delays or disruptions due to the following reasons:
- Shortage of personal protective equipment (PPE) (39%);
- Any shortage of construction materials, equipment or parts (23%);
- Any shortage of the craftworkers that either a general contractor or subcontractor require (26%);
- Any lack of needed government action or workers (16%); or
- Any information that an infected individual has entered a jobsite and at least potentially infected it (17%).
More than three quarters of firms have reported that they’re not working on any new or expanded construction as a result of the pandemic while those that are see most of their new work in the medical market.
To prevent the spread of COVID-19, construction firms are implementing the following safety measures on their jobsites:
- Integrated social distancing guidelines into operations (95%);
- Increased number of hand washing and/or hand sanitizer stations (82%);
- Implemented jobsite access screening (50%);
- Following guidelines on group sizes of less than ten people (83%);
- Increased frequency of cleaning/disinfection of high-touch surfaces (81%); or
- Increased use of PPE (78%).
Nearly three quarters of firms surveyed have applied or are planning to apply to the Paycheck Protection Program created by the Coronavirus Aid, Relief, and Economic Security Act. Only 10% who have applied reported that they’ve already been approved for a loan.
When it comes to further government action to address the economic fallout from the pandemic, nearly half of firms would like to see more funding for loan programs to maintain cash flows.
The AIA’s survey of its members was conducted on March 23, earlier on in the pandemic. At that time, more than half of firms expected inquiries for new work to decline in March and 67% of architecture firms surveyed reported already seeing prospective projects slow or stop.
At the time, the main impacts of COVID-19 on firms were increasing the amount of staff working remotely (reported by 79% of firms in some capacity) and limiting in-person client meetings/moving meetings to be virtual (also reported by 79% of firms). Nearly half of firms had implemented work-related travel restrictions while 20% had implemented a strict no-travel policy for work. Only 15% of architecture firms surveyed reported that some of its staff was unable to work at the time due to personal situations.
Firms’ expectations for April revenue losses averaged an expected loss of 15%. However, a quarter of firms expected at least a 25% loss in April due to COVID-19.