by Thomas Catenacci
The construction industry is struggling to recover from the pandemic due to difficulties hiring workers and severe supply chain shortfalls, a report found.
Construction contractors project revenue to remain stagnant and below pre-pandemic levels over the next 12 months even as the economy-wide recovery continues, according to the report published Wednesday by the U.S. Chamber of Commerce. While the Commerce Commercial Construction Index (CCI), which the Chamber measures on a quarterly basis, ticked up one point, it remained eight points below its early 2020 figure.
“This quarter’s Index findings demonstrate the fragility of our economy’s recovery from the COVID-19 pandemic,” Chamber of Commerce Executive Vice President and Chief Policy Officer Neil Bradley said in a statement. “And unfortunately, these trends are not limited to the commercial construction industry.”
While the share of contractors surveyed who expected profit margins to increase over the next year stayed the same at 24%, those expecting a decrease over that period spiked from 6% to 13%, the report showed.
More than 60% of contractors reported low availability of building products and materials, according to the report. There are particularly impactful shortages of lumber, steel and copper, according to the surveyed contractors.
The Federal Reserve has blamed supply chain shortages for rising prices and inflation. Shortages of materials and technology such as microchips has led to shortfalls in new cars and appliances.
Thirty-seven percent of construction contractors said they were concerned about their ability to hire new workers, while a whopping 92% reported that they have had some degree of difficulty finding skilled workers, the Chamber of Commerce report found.
The nationwide labor shortage has worsened even as the economy has recovered. The economy remains about 5.5 million jobs short of its pre-pandemic level, but there are nearly 11 million job openings across the country, government data showed.
“Across all sectors of the economy, businesses are facing tremendous difficulties finding skilled labor,” Bradley said Wednesday. “Supply chain shortages and rising inflationary pressures are threatening to stop our economic resurgence in its tracks.”
“We need to address our worker shortages, including by doubling legal immigration, and address supply chain issues, including through tariff reductions,” he continued.
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Thomas Catenacci is a reporter at Daily Caller News Foundation.
