TZL 1416 (web)



Up, up, and away

The disruptions we’re facing today are forcing us to get creative and evolve the ways we think and work. New opportunities are in reach if we stretch for them together.

V olatility is nothing new for construction. Weather, logistics issues, tariffs on raw materials, worker shortages, etc., are all unpredictable and bring elements of risk. Yet nothing is like what we are currently experiencing. The Associated General Contractors of America’s Producer Price Index analysis of construction materials shows that costs surged 3.5 percent from February 2020 to March 2020, and then 12.9 percent from March 2020 to March 2021. Both increases were the highest recorded in the 35-year history of the index.

Keyan Zandy

The pandemic’s ripple effect is still wreaking havoc on the supply chain. Every aspect – from the procurement of raw materials through manufacturing, loading, and shipping (via ship or truck) – has been hamstrung or bottlenecked in some way. To make things worse, natural disasters such as wildfires, hurricanes, and winter freezes (plus the power issues those often create) have all contributed in unprecedented ways. These issues have significantly increased lead times on construction materials such as steel joists, metal decking, roofing insulation, and fasteners, and a slew of other products – on some items by as much as 40 or more weeks. And the bad news

doesn’t stop there. Labor shortages, which were already a problem, are now at an all-time high. According to an analysis of the U.S. Bureau of Labor Statistics data released by the Associated Builders and Contractors, 430,000 more construction workers need to be hired in 2021 to meet the current demand (as of June of 2021). With all this uncertainty, many of us on the construction side of the business are frequently being asked when the bleeding will stop. We don’t have a crystal ball and the solutions to these complex problems remain unclear, but some ideas

See KEYAN ZANDY, page 4


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