How the Coronavirus Could Impact the US Construction Industry
Although COVID-19 (commonly known as coronavirus) is through communities in the United States, its impact on Chinese production has been devastating global supply chains. The outbreak has already affected US-based companies in tech, automotive, and airline industries, and is posing a threat to the construction industry.
鈥淩ichard Branch, chief economist for 糖心Vlog Data & Analytics, said that the American construction industry will not be immune to the coronavirus鈥� impact. For commercial builders that rely on Chinese-made goods or materials, this could mean higher material costs and potentially slower project completions.鈥�
鈥淏y Branch鈥檚 estimate, building product imports from China account for nearly 30% of all U.S. building product imports, making China the largest single supplier to the U.S.鈥�
From facing labor shortages to tariffs and price fluctuations, it鈥檚 the inherent uncertainty of the industry that makes it well suited to face adversity. COVID-19 is just one more threat to the industry that can be mitigated through strategies already in play.
鈥淧eggy Marker, president of Ft. Lauderdale-based Marker Construction Group, said she has been keeping an eye on the situation.鈥�
鈥淪he said her company鈥檚 first line of defense against volatile costs is to have a variety of sources and suppliers on hand for when prices start to get out of control. She said when Chinese granite was in short supply a few years ago, for example, her company worked to find more local vendors.鈥�
鈥淚n addition, most of her suppliers’ bids are locked in for between 30 and 90 days, which provides a buffer from unexpected price hikes.鈥�
Being that there is no current vaccine for COVID-19, no one can say how long it will take for the virus to be contained and the economy to normalize.
鈥淣obody has any kind of handle on how long this is going to be going on or exactly how it鈥檚 going to impact everything,鈥� said Peggy Marker. 鈥淔rom what I understand they think the virus is starting to plateau, so hopefully things will return to normal shortly.鈥�