An increasing number of construction companies are finding it difficult to find skilled workers, a challenge that is now prompting contractors to turn down work.
These are the latest findings from the U.S. Chamber of Commerce’s Commercial Construction Index, reporting on industry activity between July and September.
The report indicates that a daunting 92% of responding companies said they were encountering at least “some difficulty” in hiring skilled labor.
But more troubling, 55% said it had become highly difficult to find skilled workers, a number that has jumped by 10% over the Chamber’s spring index.
Also increasing: the number of contractors, at 42%, who said they have had to decline projects, up from 35% this spring, because of the worker shortage.
Not surprisingly, the lack of skilled workers is also impacting project schedules, with 73% of contractors saying they’ve had problems meeting deadlines, up from 56% in the previous index.
Exactly 93% of respondents, meanwhile, say they have been confronted with material shortages, with 34% saying pointing to a lack of steel, and 31% still plagued with wood shortages. Those numbers have changed somewhat from the last survey when 29% reported steel shortages and 33% reported shortages of lumber.
Despite the labor and materials challenges, a strong majority at 63%, according to the index, “expect profit margins to remain about the same over the next 12 months,” says an analysis of the index numbers.
“This quarter, the percentage of contractors expecting an increase in profit margin stayed the same as last quarter at 24%, while those expecting a decrease rose.”
On the positive side, the July to September index also reveals that “two of the three key drivers of the index, contractor confidence in new business and backlog, improved this quarter.”
By Garry Boulard