Courtesy Curtis Lumber
By Doug Ford
As I prepare to write this article regarding the construction outlook for 2021, I can’t help but think about all that has transpired since I wrote last year’s column. At that time, no one could have predicted what lay ahead just a few short weeks after the story went to print.
As we move into this much anticipated new year, many of the challenges I outlined for 2020 still exist and have only become more complicated due to COVID-19. Despite all the obstacles the construction industry endured, they stilled fared better than most. In the Northeast, and even closer to home, construction has been strong throughout the pandemic, in part driven by new home construction and remodeling.
Unfortunately, we cannot look forward without at least looking back briefly. It all started in March when the COVID-19 infection rates escalated and Gov. Cuomo shutdown construction for the entire state, lumping Upstate New York in with New York City.
Most industry affiliated organizations and legislators understand that upstate and the city are very different so much debate ensued to handle them differently. As a result of being shut down, most of the skilled laborers were laid off and joined many others in the unemployment pool. There were several weeks of uncertainty as builders and remodelers tried to make sense of what was unfolding in front of them.
Once construction was again deemed “essential” and business resumed, many of the skilled trades were slow to rejoin the workforce out of fear, and assistance from enhanced unemployment benefits also contributed. This only compounded the struggle builders were having with labor shortages prior to the pandemic and for the past few years.
As noted in last year’s 2020 forecast, the number one issue facing the construction industry was the lack of skilled labor and this has not changed despite the efforts gone into promoting the trades. Most contractors are confident 2021 will be a good year; going into it with a back log of work and actively bidding on new work, yet there is still an undertone of uncertainty. The political and economic climate along with an upsurge in infection rates have many worried at least for the short term.
So, what’s different this year? What’s preventing more homes from being built and renovations from happening? Both great questions.
The list of answers is long so I will just touch on a few. First and foremost is the lack of labor. I would like to take this opportunity to acknowledge the Saratoga Builders Association, Curtis Lumber, and many others who have diligently worked over the past years to bring awareness to the trades and the opportunities they present.
The single-family home building and renovation surge created a heightened demand for building materials which was not anticipated, especially after the devastating start to the year.
This increased demand came at a time when the work environment in manufacturing facilities had been drastically altered due to COVID-19. Social distancing requirements were put in place, labor shortages due to illness and/or childcare situations, additional safety measures were enforced, and adherence to CDC and OSHA mandates all of which impacted the ability for plants to function normally and manufacture products.
The high demand, production inefficiencies, product shortages and workforce challenges have all contributed to significant price increases and delayed shipments. The supply chain is currently a big unknown in our ability to forecast for 2021.
Suppliers like Curtis Lumber struggle to project accurate lead times and extended pricing to its professional customers. At a time when we should be excited about the increased volume, we are more concerned about our ability to meet our customers’ expectations. We are utilizing technology and increased communication to partner with our customers and work together to get the job done.
It’s been 10 months since COVID-19 hit us like a giant wrecking ball. We’re learning to manage through it, but the effects will be long lasting. Normal as we once knew it is gone and will be replaced with something very different. I am optimistic that post pandemic, our industry will continue to be a leader in the economic recovery as it has in many other catastrophic events throughout history. We learn to use the resources we have to their fullest extent. Good companies never let a crisis go to waste.