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Despite construction remaining an essential industry, construction lost 975,000 net jobs in April, according to analysis by Associated Builders and Contractors, the largest recorded decrease in construction jobs since the government began tracking employment in 1939. In NH, though, many contractors are still doing great, says Joshua Reap, president of Associated Builders and Contractors NH/VT Chapter. “They are hitting their numbers they planned for, and a lot of confidence has come back,” says Reap. “Things are going out to bid again.”
Construction has long been a leading economic indicator with housing starts and building permits painting a picture of what is on the horizon. That also means construction is often the canary in the economic coal mines‚ an early warning of a downturn. But the COVID-19 pandemic is creating new normal throughout the economy. While nationally the industry is hemorrhaging jobs, in NH, many construction projects are moving forward and some construction firms are actually looking to hire.
Jewett Construction in Raymond has not laid off any employees and has no plans to do so. “We are running some ads right now for a senior estimator and some project managers. We’re freighted up with work and moving forward. It’s been great to be able to announce to the entire company that this is our plan and we are not going to let anyone go. We are going to push forward,” says President Craig Jewett. “Typically, when you see recession type numbers or looming recession, it is always the construction industry that takes the hit. This time it’s completely different, we are not the first to feel it. Our company has been around 50 years, we’ve been through many recessions and I don’t think we could have ever said that before.”
North Branch Construction in Concord has also not laid off any employees and, according to Joe Campbell, the firm’s president, the company recently hired a number of new employees and is seeking to hire carpenters. He says they have not scaled back or canceled any projects due to the COVID-19 pandemic. “Our fellow construction managers in Maine, Vermont and Massachusetts have not been as fortunate with those states initially having much stricter stay-at-home orders,” says Campbell. “The majority of our projects are completed within the State of New Hampshire.”
Stacy Clark, president of Turnstone Corporation in Milford, is also seeing projects move forward. “We had a few jobs that were about to start [that have been] delayed by a few weeks, and had one project stopped for the winter. City officials held us off for the roads for a few more weeks. In all, we didn’t lose any jobs and actually picked up a job in New Boston,” says Clark. “This is the first time we were not hit first.”
She says manufacturers and business owners moving forward with projects demonstrates confidence they will survive. “It’s an important part of the economics that construction has continued. If we can continue to build, it will be very positive for the overall economy,” Clark says.
Productivity is Down
While projects are still moving forward, it’s not at the same pace as before the pandemic, which has required changes in the field that protect workers but slow productivity. The governor’s revised Stay-at-Home Order issued on May 1 included a number of new mandates, such as screening every worker and taking their temperature before allowing them to work. “In essence, this sounds simple, however, a project site with over 80 workers who all arrive to work at the same time inevitably makes this screening process a time burden,” Campbell says. “Whether it is practicing social distancing, phasing work crews, non-typical new PPE requirements, smaller work crews limiting the number of workers in certain areas, it all affects productivity.”
Productivity is also hampered by the lack of needed workers. Construction had labor shortages before the pandemic. Reap says entry-level jobs are harder to fill in part because the additional $600 per week federal unemployment benefit is greater than what those entry workers would make in the field. “It’s posing a challenge to many industries,” he says.
The labor shortage is exacerbated by some employees not returning to the field either because they have children at home they need to care for and home school or because they are concerned returning to work will expose them to the COVID-19 virus. “In one instance, a whole plumbing crew went into self-quarantine as a precaution due to possible exposure with a worker who tested positive at a prior job site the crew had worked on,” Campbell says.
There have also been the inevitable supply chain interruptions, including delivery delays and manufacturing plant shutdowns across the U.S. and Canada. Planning allowed North Branch to forge ahead on a major project at Wallace Farm Apartment Homes in Londonderry. Campbell says in late March, the company needed to buy the first of three panelized, wood-frame building packages for the project. There was concern the Canadian border might close and the product would not ship. North Branch decided to purchase all three buildings at once, spending more than $1 million out of pocket to get the materials onsite so that work could continue.
Still, the slowdown in productivity is better than what the industry could have faced. Clark of Turnstone says she is happy the governor didn’t shut down construction even briefly as some states did as it could have resulted in a domino effect. “If you think about the sequence of a contract, if you have a concrete guy, he has his schedule and if construction had closed, all of us would have been looking for that one subcontractor to start six weeks’ of work at once,” she says.
Protecting Workers
However, despite the hit to productivity, Campbell says his company takes the COVID safety mandates seriously. “[We] understand their importance when it comes to ensuring the safety of our employees, subcontractors and the families they go home to.”
North Branch was one of the first contractors to build mobile hand wash and sanitization stations, which have been distributed to project sites, Campbell says. He then shared the design with other companies. To help incentivize workers, North Branch is paying all of its field employees an additional $3 per hour stipend until the stay-at-home order is lifted.
Construction is heavily regulated and firms are used to instituting rigorous OSHA safety practices on job sites. Due to the work performed at construction sites, many construction companies already had personal protective equipment (PPE) on hand, such as gloves, masks, protective eye gear and face shields before the crisis even hit says REAP.
“Not everyone would have wear to gloves for every job in the past, but now they just keep them on,” Reap says.
Contractors licensed in multiple states are having to track different state guidelines, such as Jewett Construction, which has projects in five states. “It’s been pretty interesting watching the news conferences of five governors,” he says. “Our HR department is constantly juggling how we are going to work in each state.”
No matter the job site, though, Jewett’s employees and subcontractors are wearing PPE. “That is very comforting,” Jewett adds.
Clark says the sheer volume of information surrounding COVID-19 is a challenge. “We were getting so much information so quickly and it was changing so quickly. You would read it, work on how to comply and it would change the next day,” she says. “The first few weeks were extremely overwhelming.”
Looking Ahead
Despite ABC’s statistical analysis at the national level pointing to another month of “crushing job losses” when May figures are released, Reap says there is optimism in the Granite State.
That optimism is rooted in the ability to adapt to a “new normal,” despite a yearning to get back to the way things used to be. Prior to the pandemic, North Branch had already built the infrastructure for most employees to work remotely. “One positive of the pandemic is it has forced our hand to train and utilize this infrastructure to its fullest,” says Campbell. “I have joked on a number of occasions that we will all be Zoom experts at the tail end of this pandemic. It also feels somewhat strange to think that in the months, possibly years to come, greeting another professional with a handshake may not happen.”
Jewett echoes the sentiments about finding new ways to be efficient, yet adds he misses pre-COVID elements of the business. “I’ve been in the office every day and have missed the inner-office comradery. We can get on a Zoom meeting but it will never be the same as shaking hands and meeting in a conference room. I can’t wait for those days to come back. And they will. This country is resilient and forgetful. Just keep washing your hands and you can come into my conference room,” he says.
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