Capitol Update 4/25/22
The US construction industry is experiencing a worker shortage even though construction employment in March rose above pre-pandemic levels in 32 states. “Contractors have been adding workers as fast as they can find them,” said Ken Simonson, chief economist at AGC. Full Story: The Construction Index (UK)
Construction Dive Trendline on Labor
Construction firms should partner with talent organizations, build inclusion and measure their progress in doing so, according to a Building Talent Foundation report issued to coincide with this year’s Women in Construction Week. Though the number of women in construction has increased over 50% in the past decade, according to a Fixr report, the percentage of men and women working in different areas within the industry varies greatly. For example, women represent 17.1% of workers in management and professional roles, and 24.6% in subcontractor roles. But that percentage is still quite low compared to other industries, according to the Fixr report. In the field, the imbalance is even more stark. Only 3% to 4% of jobs in production, transportation, construction and maintenance are occupied by women, according to Fixr.
Biden administration mandates US iron, steel for infrastructure projects
Projects funded by the $1.2 trillion infrastructure package must only use iron and steel produced in the U.S., according to a White House memo. The requirement, which was included in the Infrastructure Investment and Jobs Act, means all manufacturing processes for the metals, from the initial melting stage through the application of coatings, must occur in the U.S. starting May 14. The announcement includes a process to waive those requirements if domestic materials are not reasonably available or would raise the cost of the project by more than 25%.
The Associated General Contractors of America has spoken out against a part of the bipartisan infrastructure law that calls for construction materials to be sourced domestically unless the practice is deemed not in the public interest, the materials are not readily available in the US or when using domestic materials would increase project costs by more than 25%. “It makes no sense to place unrealistic limitations on firms’ ability to source key materials at a time when prices for those products are skyrocketing and supplies are limited,” says Stephen Sandherr, the Associated General Contractors of America CEO, adding that a waiver provision “is like asking the US Department of Education to verify every child’s permission slip to miss a day of school.”
Economic headwinds threaten construction’s spring recovery
After two years of pandemic-related fits and starts, builders are set for a busy spring. Construction and engineering spending reached $1.57 trillion in July 2021, according to Deloitte, and revenue growth will likely accelerate in 2022. In a survey of over 500 U.S. executives and other senior leaders in the field, Deloitte also found that 92% characterize their business outlook as somewhat or very positive, 23% higher than the previous year. But this spring isn’t all roses and sunshine. Supply chain constraints and rising costs, in some cases exacerbated by pent-up COVID demand, are making sourcing materials and sticking to budgets more difficult. “It just very hard for an industry that typically operates on a small margin and has to go through competitive bidding process to accurately predict what they’re going to be paying or, as important, when those materials are going to show up,” said Brian Turmail, vice president of public affairs and strategic initiatives at the Associated General Contractors of America. “It’s a really challenging time for what was already a challenging time.”
The number of US hotel rooms in the planning phase at the end of March leaped 26.3% over last year, countering a decline in rooms under construction and in the final planning stages, STR reports. The total being built was roughly 155,000, with New York leading at 14,300 and Nashville, Tenn.; Miami; and Detroit following. Full Story: Business Travel News
Nonresidential construction starts would have risen 10% in March without the beginning of work on three major manufacturing facilities, according to Dodge Construction Network. Instead, the nonresidential component declined 29% for the month, bringing overall starts down 12%. Full Story: Dodge Data & Analytics
Housing starts were up 4% last month from the year before and up 0.3% from February, the Census Bureau reported. The latest gain was driven by the multifamily category as single-family starts were down from February and from a year earlier. Full Story: MarketWatch (tiered subscription model)
Pent-up demand from the pandemic is expected to keep builders busy this spring, but they’re likely to face budget and sourcing challenges due to supply chain difficulties and costs that continue to rise. “It’s just very hard for an industry that typically operates on a small margin and has to go through competitive bidding process to accurately predict what they’re going to be paying or, as important, when those materials are going to show up,” says Brian Turmail from the Associated General Contractors of America. Full Story: Construction Dive
The Mission Rock Academy in San Francisco offers a five-week apprenticeship program to train women and address the gender disparity in the building trades. The project is the brainchild of Fran Weld, senior vice president for strategy and development with the San Francisco Giants, inspired by the dearth of female workers on the $2.5 billion Mission Rock waterfront development near the Giants’ stadium. Full Story: Fast Company (tiered subscription model)
Here comes the sun: OSHA launches new program for heat safety
The heat is on. On its way, that is. In preparation for the summer months, Department of Labor Secretary Marty Walsh (pictured above) joined Vice President Kamala Harris Tuesday to announce a new heat-related illness enforcement program. OSHA has launched a National Emphasis Program in an attempt to protect millions of workers from heat illness and injury. NEPs are temporary programs that focus OSHA’s resources on particular hazards. The organization will conduct heat-related inspections in an effort to prevent workers from suffering preventable injuries or fatalities. “Tragically, the three-year average of workplace deaths caused by heat has doubled since the early 1990s,” Walsh said. “From farm workers in California to construction workers in Texas and warehouse workers in Pennsylvania, heat illness — exacerbated by our climate’s rising temperatures — presents a growing hazard for millions of workers.”
Exceptionally rare and dangerous’ malware threatens critical infrastructure
Federal authorities, including the Cybersecurity and Infrastructure Security Agency, FBI and Department of Energy on Thursday urged critical infrastructure providers to take immediate cyber mitigation efforts, as certain advanced persistent threat actors developed custom-made tools that can take over certain industrial devices. Cybersecurity researchers from Mandiant, working with multinational electrical firm Schneider Electric, warned that state-sponsored “threat actors” developed a set of tools it calls Incontroller, which can be used to shut down, sabotage a facility or disable safety controllers at various industrial sites including power plants. The company warned the tools pose the greatest threat to sites in Ukraine, NATO member states and other countries actively opposing the Russian invasion of Ukraine. In light of the threat, Schneider Electric provided a security bulletin with mitigation measures that can be used to protect systems.
A $6.4 billion Carbon Reduction Program under the bipartisan infrastructure law is designed to help states over the next five years develop strategies to curb their carbon emissions. The program announced by the Federal Highway Administration will focus on on-road highway sources of emissions and may include things such as electric-vehicle infrastructure, bus rapid transit and micromobility projects. Full Story: Department of Transportation
A plan to remove four dams on the Klamath River in California and Oregon is nearing realization with support from the Interior Department and previous backing from the Federal Energy Regulatory Commission. However, FERC continues to take public comment on Klamath River Renewal’s $445 million project, which would remove one dam in Oregon and three in California. Full Story: Engineering News-Record (tiered subscription model)
Los Angeles’ $1.8 billion Regional Connector Project has reached the 90% completion mark, and test runs are underway. The underground light-rail project extends 1.9 miles to connect three lines and three stations about 100 feet beneath downtown. Full Story: The Associated Press
The entrepreneur behind Italvolt and Britishvolt has formed a new company, Statevolt, that is evaluating sites in the Imperial Valley of Southern California to build a $4 billion, 54-gigawatt-hour gigafactory to manufacture batteries for electric vehicles. The move comes after Japanese company Envision AESC shared plans for a $2 billion, 30-gigawatt-hour gigafactory in Bowling Green, Ky. Full Story: The Construction Broadsheet