Fall 2016 issue of Horizons

CONSTRUCTION

Annual Construction Spending

$1,200M

$1,112.4M

$1,077.4M

$1,005.6M

$906.4M

$906.5M

$850.5M

$823.5M

$900M

$809.3M

$788.3M

$768.6M

TOTAL

$729.5M

$635.7M

$591.6M

$571.1M

PRIVATE

$600M

$505.3M

$501.9M

PUBLIC

$314.9M $304.0M

$308.7M

$288.9M

$286.4M

$279.3M

$276.1M

$270.7M

$300M ANNUAL SPENDING

$0M

2008

2009

2010

2011

2012

2013

2014

2015

Source: U.S. Census Bureau, Construction Spending Report

Unemployment by Position The AGC surveyed its members in September 2015 and received over 1,350 responses. Of the responses, 59.0% had total annual revenue of less than $50 million. Companies were asked what their most difficult positions were to fill. For hourly employees, they responded that carpenters, sheet metal installers, concrete workers and electricians were the most difficult positions to fill. For salaried employees, project managers, estimators and engineers were the most difficult to fill. Offsetting Workforce Shortages The aforementioned survey summarized how companies are compensating for the worker shortage. Primarily, companies are increasing base pay and providing incentives and bonuses in response to the labor shortage. In addition to increasing compensation, companies are also using more subcontractors and staffing agencies. While companies are discovering ways to mitigate the labor shortage issue, they face the potential risk of relying on workers unfamiliar with the proper safety procedures and policies at a higher cost.

Additionally, per the published 2015 Workforce Development Plan , the AGC is working at the federal level on several issues to revive the labor force in the construction industry. Specifically, efforts to reform and reinvigorate the Perkins Act are being made so there is a new emphasis on increased funding and more flexibility for school officials to teach in- demand skills sets. The plan outlines, among several initiatives, increased trade related courses being offered to high school students through the community college system and immigration reform. Material Costs Each month, the AGC publishes data summarizing the producer price index (PPI) for key construction related outputs. The PPI measures the average changes in prices received by domestic producers for their output. The PPI of several key raw materials for the construction industry have increased marginally over a 12-month period from January 2015 to January 2016 including flat

page 22 | horizons Fall 2016