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The highest net positive reading from the survey was for transportation construction (55 percent). This was followed by a 45 percent net reading for bridge and highway construction projects and a 37 percent net reading for federal projects.
The AGC of Washington chapter recently conducted a survey about what's in store for the construction industry in 2024.
Stephen E. Sandherr, chief executive officer of the Associated General Contractors of America, recently penned an article detailing that Washington contractors remain upbeat about the available dollar value of projects.
AGC of America and Sage conducted an annual nationwide survey of construction firms to get a better sense of the industry's expectations for the coming year. Early in January, officials released the latest construction hiring and business outlook, titled "A Construction Market in Transition." Contractors in Washington and across the country remain upbeat about the available dollar value of projects to bid on in 2024.
Among contractors in Washington state, the net reading — the percentage of respondents who expect the available dollar value of projects to expand compared to the percentage who expect it to shrink — is positive for 14 of the 17 categories of construction included in the survey.
Washington contractors are most optimistic about infrastructure and federal construction projects. Specifically, the highest net positive reading in the 2024 survey — 55 percent — was for transportation construction. This was followed in Washington by a 45 percent net reading for bridge and highway construction projects and a 37 percent net reading for federal projects.
Most firms in Washington anticipate adding workers in 2024 to accommodate the higher demand for projects. More than two-thirds (68 percent) of the respondents expect to add to their headcount, compared to only 13 percent who expect a decrease. However, 69 percent of Washington contractors report they are having a hard time filling some or all salaried or hourly craft positions.
As a result of these labor challenges, most firms in Washington took steps in 2023 to attract and retain workers. Fifty-eight percent increased base pay rates more than in 2022. Additionally, 39 percent of firms provided incentives or bonuses and 19 percent of the firms increased their portion of benefit contributions and/or improved employee benefits.
Meanwhile, almost equal percentages of firms in Washington report projects were postponed or canceled in 2023 and not rescheduled (44 percent of respondents) as report projects were postponed but rescheduled (40 percent). Ominously, 13 percent have already experienced postponement or cancellation of a project that had been scheduled for the first half of 2024.
These challenges are prompting many firms to invest in technology that will make them more efficient. Thirty-six percent of respondents from Washington state expect their firms to initiate or increase investments in drones, while 26 percent will invest in artificial intelligence — many for the first time — and 23 percent will invest in offsite production.
The Associated General Contractors of America is working to make sure the outlook for 2024 remains positive. It is pushing for new funding for construction education and training programs as part of both the Workforce and Innovation Opportunity Act and the Pell Grant reauthorization legislation that are expected this year in Congress.
AGC will continue to urge the Biden administration to implement mandated reforms to the federal review and permitting process and otherwise ensure that the federal government no longer serves as the biggest obstacle to its own construction investments.
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