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Coronavirus Response Suspends Some Construction; NY and NJ Governors Cite Need for Building Medical Facilities

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As of 9 a.m. Tuesday March 17

For most companies in the construction industry, it remains business as usual with bid openings and construction continuing, states are stepping in to suspend some projects as part of the extraordinary measures being taken to stop the spread of the coronavirus.

The Pennsylvania Department of Transportation is suspending all construction projects through March 30, but PennDOT crews will be available for “critical functions and emergency maintenance.”

In Bergen County, NJ, county executive Jim Tedesco ordered all construction suspended and utility roadwork done only in emergency situations. It remains to be seen if this is enforceable or companies will follow Tedesco’s order or fight it.

But while non-emergency construction was being suspended in some places, the governors of New York and New Jersey are looking to turn college dorms, former nursing homes and other buildings into medical facilities to treat patients as hospitals are expected to be overwhelmed. Private developers, construction workers, and the National Guard are expected to be needed for these emergency projects. The plan is currently a backup in case the federal government does not meet his request to send the Army Corps of Engineers to build temporary hospitals.

Before state and local governments began enacting these more extreme measures to “flatten the curve” of the spread of the disease and its impact on hospitals, there have been reports of specific sites across the country shutting down after a worker tested positive and companies taking precautions to keep workers safe.

The Associated General Contractors has a webpage dedicated to the virus with information about symptoms and what constitutes a reportable workplace illness. “AGC will continue to monitor the situation and update the information on this page accordingly,” the site said.

Over the weekend, the Centers for Disease Control recommended no groups with more than 50 people for approximately eight weeks.

Coronavirus Impact on the Construction Industry

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The impact of the coronavirus will likely be felt in every industry, and while the extent of the impact is unknown as the situation evolves quickly around the world, construction was already taking a hit.

Before the public became aware of people testing positive in the United States, a slowdown in the production of supplies in China was already raising costs. U.S. construction companies import about 30 percent of their building products from China. It is the largest importer of construction materials to the U.S. As the Chinese government shut down factories, a manufacturing decline was already creating supply issues and driving up prices for American companies.

Now, the crisis has hit the U.S. and there is further uncertainty in an industry that was already getting mixed messages.

The U.S. Construction Outlook report for 2020 put out by commercial real estate and development firm Jones Lang LaSalle Inc. reported that industry volume and hiring would be flat this year. It also predicted growth for companies that work for the government on projects related to schools, healthcare, and transportation. That report was released last week.

At this point, there is no way to predict the construction man-hours that might be lost to illness or what the brewing economic crisis, caused in part by the global pandemic, might do to future projects. The situation seems to change by the hour and right now industry professionals can only have a plan for the possible effects and wait and see.