The construction industry a took huge hit with coronavirus shutdowns and the ensuing economic downturn. But New York City was impacted more than the surrounding area in the first half of 2020, according to a CIS analysis of its projects.
In some of the most revealing numbers: new public projects put out to bid were down 51 percent. That’s more than 20 percent worse than Long Island and an even larger decline compared to Westchester, and New Jersey.
Most discouraging was the total value of public projects that were bid in the first half of the year. Those numbers were down 61 percent. It is worth noting, however, that New York City’s project numbers were lower in January, February, and March, as well. The state didn’t shut down nonessential construction until March 31.
Employment in New York City building construction fell by more than 35 percent year-over-year in May, according to the state’s Department of Labor. While there was an immediate rush of activity and rehiring once non-essential construction could resume, that was primarily to catch-up on projects that were in progress. With the reduced number of public projects put out to bid, industry leaders worry that the work and hiring won’t continue.
Data from July backs that fear. According to the Associated General Contractors of America (AGC), construction employment in July was down 66 percent in 358 metro areas across the country compared to the year before. New York City lost the most construction jobs, down 26,500 (or 16 percent) from the previous July, according to the AGC.
Amid fears that the virus numbers will spike, forcing another shutdown in the city, contractors are pushing to finish work on projects in progress, but there is understandable concern that budget issues will kill any hopes of continued recovery. When the city’s budget passed in July – the first budget that has been lower than the previous year since the Great Recession in 2009 – money for affordable housing and public projects was cut. New York City faces a projected $9 billion revenue loss because of the global pandemic, at the same time President Trump is threatening to cut off federal funding to the city. If federal funding doesn’t come, Governor Andrew Cuomo says vital infrastructure projects and some of the city’s biggest construction plans, including projects at LaGuardia and JFK airports and the new Penn Station, could be put on hold. The AGC says that without federal funding, commercial construction companies will be forced to lay off more workers.
The analysis did show one bright spot: The number of new private projects being planned actually increased from 2019.
This could continue, particularly in private healthcare projects. Industry experts predict growth in healthcare construction for New York City over the next few years. There may even be an opportunity for private projects developing outdoor spaces for restaurants and retail.