There’s no doubt that the Coronavirus has changed everyone’s life. Those who had it will never be the same, and those who haven’t still live in fear. The construction industry is not immune to these changes. From a drastic material shortage to new ways to collaborate, the industry will never be the same.
Here are five ways the construction industry has been impacted by COVID.
1. Materials shortage
There isn’t a trade that hasn’t been impacted by the materials shortage in some way. It started with factory shutdowns due to stay-at-home orders and was followed by a trucking and shipping labor shortage. Now we have hundreds of cargo ships stranded outside ports waiting to be offloaded.
The materials shortage started with lumber, then moved quickly to steel and other building materials. Now there isn’t anything that hasn’t been affected. Approximately 68% of contractors surveyed said they were experiencing material delays in the 2nd quarter of 2021. The shortage has delayed projects and caused prices to skyrocket. At one time lumber was up over 300% from the previous year! And now we have additional supply chain issues to deal with in the coming months. There doesn’t seem to be a quick answer to this one.
2. Health becomes a priority
Gone are the days of going to work when you are sick. Since almost any symptom could be a sign of the COVID virus, everyone with cold or flu-like symptoms was sent home. Workers were told not to come in if they felt sick. Then, once tests were available, we went to testing everyone and quarantining those who tested positive. Whole crews or job sites could be knocked out and the project placed on hold due to contact tracing and the required quarantining.
Now we are dealing with vaccines, mandates, and whether to mask or not. What started as a health issue has become a political hot potato. It’s left companies in employees wondering “what next?” Things won’t go back to normal anytime soon. Contractors developed new ways to track symptoms and contact traces using construction software packages.
3. New ways to collaborate
When the stay-at-home orders first came out, design teams could no longer travel or meet on job sites. Everyone that could work from home did, which made collaboration much more difficult. But teams rose to the occasion and found new tools they could use to work together. Tools like drawing collaboration were used to keep everyone informed of design changes. And Zoom calls became the norm as teams worked together to make it work.
Even building inspectors started doing inspections using photographs and video conferencing. This sped up the inspection process for all involved.
Cloud computing and web-based SaaS software have changed the ways teams collaborate. Since most were working from home and travel was restricted, being able to access documents and information from anywhere became a necessity, not a luxury. Cloud-based technology and construction
management software, like Premier, helped contractors stay connected, scale their operations without having to rely on human resources, make investments in their companies that eliminated time-consuming processes, and identify cash flow issues and problem projects early. Without such flexibility, many companies found it hard to operate in the new environment.
4. E-Signing became more popular
One thing that couldn’t stop was payments, and to keep the documents flowing many companies had to rely on electronic signatures. Although they’ve been legal for years, they gained in popularity during the pandemic. Some states, like Oregon, started accepting remote notaries, while others had been for years. A remote notary session involves the notary and signer getting together on a conference call to witness the signature. This makes it easier for lien waivers and other documents to be notarized so they don’t hold up payments.
The more electronic signatures were collected, the more document management became a necessity. Companies had to track lien waivers, subcontracts, contracts, change orders, and purchase orders and know when each had been signed. Construction management software, like Premier, allows contractors to keep these documents organized and know exactly who’s missing. You can seamlessly connect your e-signature software with Premier software to collect the signatures you need quickly and easily.
5. Materials cost increases force price increases
It started with lumber, rocketing 300 percent from its starting price, then other materials started raising their prices. Now gas prices are rising, along with other supplies for construction projects. As prices rose, contractors started to pass on those costs to their customers. The cost to frame a house more than doubled during the height of the lumber price spike.
Some customers delayed projects to try to avoid high material costs, while others just paid the price. Many contractors started adding price escalation clauses to their contracts to protect them in this volatile market.
We can only hope that someday we’ll be able to put this pandemic behind us and return to life as we knew it. Some of the changes to the construction industry caused by COVID are for the better, like making health a priority and the rise of collaboration. Other changes, however, like price increases and material shortages, are best left in the rearview mirror.
Dawn Killough is a construction writer with over 20 years of experience with construction payments, from the perspectives of subcontractors and general contractors. Dawn has held roles such as a staff accountant, green building advisor, project assistant, and contract administrator. Her work for general contractors, design firms, and subcontractors has even led to the publication of blogs on several construction tech websites and her book, Green Building Design 101.