2022 Marcum National Construction Survey

DESPITE HEADWINDS, CONTRACTORS REMAIN UPBEAT By Anirban Basu, Chief Construction Economist

There are certainly many items about which to complain. Inflation runs rampant. Supply chain issues, equipment shortages, and expanding construction materials prices remain pervasive. War in Eastern Europe and economic lockdowns in the Far East continue to keep oil and natural gas prices elevated while also hammering away at global food supply. Meanwhile, COVID variants continue to circulate, with periods of low infection followed by spikes. Masks come off, only to be yanked out of drawers to be slapped on once again. Remarkably, against this backdrop, responses from Marcum’s latest Construction Trends Survey indicate that contractors remain upbeat regarding their collective future. Certain pre-pandemic issues remain firmly in place, especially with respect to a shortage of skilled craftspeople. Other issues are more novel, including astonishing increases in steel, concrete, and diesel fuel prices. The result is that the cost of delivering construction services has raced higher in America.

The risk would be that these higher costs would drive prospective purchasers of construction services to the hills. Instead, many contractors report healthy backlog, many bidding opportunities, and operating at capacity. Amidst the supply chain and public health clutter, there is a broader economic recovery that persists. Through 2022’s initial four months, the U.S. has added an average of 519,000 jobs/month. The unemployment rate has dipped to 3.6 percent (April 2022), and is lower than 3 percent in a number of major metropolitan areas (e.g., Phoenix, Tampa, Miami). The labor force participation rate has generally been edging higher, with 62.2 percent of adult Americans either working or looking for work as of April. One could make the argument that normalcy is emerging from the wreckage that accompanied the initial months of the pandemic.

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