Challenges and Opportunities for Constructions in 2021

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The year 2020 was difficult and 2021 is presenting greater challenges as many countries are dealing with another wave of lockdowns and economic downturns.

The engineering and construction sectors were among the primary businesses that have been greatly affected with several projects canceled or put on hold. Source2Load Engineering and Consulting, an expert in MEP Engineering in Houston, TX is no different.  While many companies can operate with all their employees working from home, this is not possible for contractors and engineering firms who have projects to deliver. Designing and approving a building design can be done remotely, but workers must interact in person when the construction starts.

In addition to the pandemic, the US construction industry faces other challenges in 2021 such as the significant price increase of key materials, higher unemployment rates, and continuous disruptions and delays of construction projects. However, there are opportunities and advancements which Source2Load Engineering and Consulting are ready to adapt to continue providing quality services for MEP engineering in Texas, and nearby states of Louisiana, Alabama, and Florida.

They say, uncertainty awaits on each and everyone’s road but we thrive with resilience. Here are the challenges and opportunities for US contractors and engineering firms for 2021.

Challenge 1: Materials Are More Expensive

Supply chains and industries were affected by the coronavirus lockdown and the price for many construction materials increased between 2020 and 2021 especially for two important ones:

  • Iron and steel became 15.6% more expensive between January 2000 and January 2021.
  • Softwood lumber increased in price by 73% in the same period.

The increase in lumber prices had the most impact on residential construction according to the National Association of Home Builders. Meanwhile, the effect of price increase for iron and steel is felt most in the commercial sector since reinforced concrete and steel structures both depend on these materials.

Construction project costs are increasing according to the materials used. In addition, companies have been hoarding materials to protect themselves from price spikes making the demand rise and driving the prices even higher.

Challenge 2: Employment is Low

A lot of construction projects were slowed, paused, or worse- closed down completely in 2020 due to lockdowns imposed to prevent the spread of COVID-19. These reduced both construction revenue and demand for labor, and thousands of construction workers lost their jobs in a matter of months.

In the process of recovering from lost jobs, February 2021 came with harsh winter storms causing once again a halt to the construction industry due to large-scale blackouts. Even so, construction activity tends to increase in summer, increasing the demand for labor.

Opportunity 1: COVID-19 Relief Bill Has Construction Incentives

The second COVID-19 relief bill has a total value of $1.9 trillion and a portion of the budget can be allotted for use in construction projects. The bill prioritizes education, Federal Transit Administration, restaurants, healthcare, COVID-19 research centers, and tribal governments.

The bill introduced $340 billion in coronavirus recovery funds, which will be managed by state and municipal governments. These funds can be used for various purposes including construction. 

Opportunity 2: Technology for Construction Projects

Technology is a big part of shaping the construction industry this year because of its permanent benefits in addition to COVID-19 prevention. Many emerging technologies are deployed in project sites such as wearable sensors to help workers stay safe and drones to survey sites without entering high-risk areas.

Contractor and engineering firms who deploy technology can gain a huge advantage, which will help them with challenges brought by the year 2021. One example is the use of BIM software to optimize the use of construction materials and the use of advanced technology in project sites to keep workers safe.

Although the pandemic is causing unavoidable downfall to business sectors, Source2Load Engineering and Consulting does its best to carry on in these rapidly changing times, bringing new ways to deliver MEP engineering and design services.