Construction Spending Inches Higher in August but Declines Year-to-Date as Increase in Public Construction Contrasts with Mixed Private Results

October 1, 2019

Association Survey Finds Projects Take Longer than Anticipated as Contractors Cope with Staffing Challenges; Officials Urge Increased Investment in Career and Technical Education, Greater Immigration for Qualified Workers

Construction spending edged up 0.1 percent in August from July but declined from year-ago levels, with divergent trends in residential and nonresidential categories, according to an analysis today by the Associated General Contractors of America of new federal spending data. Association officials said that many contractors in its recent survey report that staffing challenges are causing projects to take longer than expected, which may be holding down spending. They urged government officials to boost funding for career and technical education and pass comprehensive immigration reform to ease the shortage of construction workers that is slowing projects.

“Eighty percent of the nearly 2,000 contractors responding to our workforce survey this summer reported difficulty filling hourly craft positions,” said Ken Simonson, the association’s chief economist. “Of the firms experiencing staffing challenges, almost half—44 percent—said that projects had taken longer than anticipated. Those delays may be one reason that spending put in place is lagging, even though contractors almost universally report they are busy and would be doing even more projects if they could find enough workers.”

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