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The COVID-19 pandemic created seismic changes in how businesses operated during the height of the pandemic. As the recovery continues to unfold many have started to thrive again. The demand for products and services is once again robust and restrictive orders a thing of the past. Despite the optimism, some industries continue to face challenges on the road to recovery, including construction. According to the Associated General Contractors (AGC) 2021 Construction Outlook Survey Results, Texas, the combination of extended project deadlines and rising material costs have made it difficult for construction companies. When combined with declines in project dollars across several areas, it appears there are still issues to overcome. To help clients, prospects, and others, understand the findings and impact on their organization, Calvetti Ferguson has provided a summary of the key details below.

About the Survey

The survey was conducted online and includes responses from Texas-based construction companies such as engineering firms, general contractors, owners/developers, specialty contractors, subcontractors, and suppliers.

Key Survey Findings

Top Concerns

Given the tremendous change over the last year, the survey wanted to understand management’s top concerns for 2021. It was found that 78% of respondents are most concerned about the continuing impact of the pandemic on projects and workers, 58% material costs, 55% increased competition, 40% worker quality, 39% rising direct labor costs, 29% worker shortages, 23% subcontractor quality, 20% inadequate career training and 20% indicated impact of immigration policies on the labor supply.

Pandemic Impact on Projects 

The survey also wanted to understand how the pandemic has impacted current projects and the bidding process. It was found that 62% of respondents indicated projects have taken longer than expected, 41% costs have been higher than expected, 29% have started placing higher costs into bids, 23% put longer completion times into bids, 22% no long put completion times into bids and 17% have put lower prices into bids/contracts. It is not surprising that bids have changed since many companies want to better manage costs and expectations.

Finding New Workers 

Concurrent to the challenges associated with project management, staffing issues are also a concern. The survey wanted to understand how challenging it has been to find new staff. It was discovered that 39% expect there will be no change in difficulty, 20% believe it will continue or will become harder to hire, while 40% believe it will actually become easier to hire in 2021. The optimism stands in stark contrast to 2020 conditions when over 45% of respondents indicated difficulty filling openings.

Return to “Normal”

Since the pandemic resulted in significant disruptions to business in 2020, the survey wanted to understand how long it will take for things to return to normal. It was found that 35% indicated the volume of business already matches/exceeds last year, 31% expect it to take 1-6 months, 31% more than six months and 20% do not know when conditions will fully rebound.

Scott Contreras, CPA

Assurance Partner

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