Federal assistance needed to stem future job losses, promote growth in construction sector - AGC

Author: Adam Yanelli

2021/03/15

HOUSTON (ICIS)--The return of jobs in the US commercial construction sector has not kept pace with overall employment growth, prompting a trade group to say that federal measures are needed to stem future losses and create new jobs.

Officials with the Association of General Contractors (AGC) said construction demand will continue to suffer amid pandemic-induced economic uncertainty and urged federal officials to work to help prevent additional job losses in the sector.

These measures should include new federal investments in infrastructure, ending tariffs on key construction materials, addressing supply chain backups and avoiding costly and unneeded new regulatory burdens, the AGC said.

“The pandemic is driving away projects, contributing to spiking materials prices and helping make delivery schedules unreliable,” CEO Stephen E Sandherr said. “Contractors will not be able to build back better if they have to keep paying higher prices for materials that rarely arrive on time.”

An AGC survey, which included responses from almost 1,500 firms, found 34% had reduced their employee count in the past year, compared to just 20% that added employees.

More than 75% of the firms had experienced project cancellations or deferrals, while only 21% reported winning new projects or add-ons to existing projects in the past two months.

“Despite improvement in many sectors of the economy, nonresidential contractors are coping with widespread project cancellations and postponements, soaring materials costs and lengthening delivery times,” AGC chief economist Ken Simonson said. “That combination makes further job cuts likely in many states.”

Construction employment in January remained below pre-pandemic levels in all but eight states.

Texas lost the most construction jobs during the pandemic (-51,900 jobs or -6.6%), followed by California (-36,200 jobs, -4%) and New York (-26,000 jobs, -6.4%).

Louisiana experienced the largest percentage loss (-14%, -19,200 jobs), followed by Wyoming (-9.6%, -2,200 jobs).

The AGC said previously that the winter storm that hit the southern US in February was not likely to generate the construction demand boosts typically seen after hurricanes.

The construction industry is an important end market for chemicals.

Paints and coatings are made with titanium dioxide (TiO2) and several solvents such as glycol ethers, butyl acetate (butac), methyl ethyl ketone (MEK) and isopropanol (IPA).

For polymers, most polyvinyl chloride (PVC) goes into construction, according to the American Chemistry Council (ACC). Polyurethanes and expandable polystyrene (EPS) are used in insulation.

Other polymers used in construction include high density polyethylene (HDPE).

 

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