AGC: 73% of construction firms plan to expand workforce in 2017

Dive Brief:

According to an Associated General Contractors of America survey of approximately 1,300 construction companies, 73% plan to add employees in 2017 in order to meet anticipated demand in both the private and public sectors.
Despite the general optimism, firms also expressed concern that they will not be able to find enough qualified workers to fill available positions. In fact, 73% of respondents said they are having difficulty finding qualified workers, and 76% of those surveyed believed that the tight labor market would only get worse, or at least stay the same, in 2017.
The report, produced in conjunction with Sage Construction and Real Estate, also found that employers were worried about rising regulatory and healthcare costs.

Dive Insight:

Only 9% of contractors surveyed expect the demand for their services to decline, with the balance anticipating either growth (46%) or business to remain at current levels (45%). Survey participants were most enthusiastic about their prospects in the hospital-retail and warehouse-lodging markets but also anticipated stronger activity in all other markets, with the exception of the multifamily sector. Only 11% of respondents said they anticipated growth in that sector, down from 14% in 2015.

The AGC pointed out that while 2017's projected economic environment supports industry optimism, many survey responses assume that President-elect Donald Trump will live up to his campaign promises of increased infrastructure investment, a revamp of existing healthcare laws and a decrease in costly regulations.

"Contractors remain quite concerned about labor shortages, tight margins and growing costs," AGC Chief Economist Ken Simonson said in a release. He added that an aging, retiring workforce is also a major concern.

The skilled labor shortage has been an ongoing concern for the industry, and there is no easing in sight. In last year's AGC outlook report, 69% of firms reported that they believed the worker shortage would remain the same or get even worse in the next year, compared with 76% in this year's report.