Waiting until the next bidding season, the pandemic's effects on construction
Between 2016 and 2017, Alaska lost over 2,400 jobs in the construction industry,
. In the years since some of those jobs have come back, but as with many industries, the arrival of the coronavirus pandemic slowed that growth down.
After small growth in 2018 and 2019, 2020 was expected to be a good year for many in the construction industry.
“We were looking really promising, looking good,” said Jonathan Hornak, Senior Project Manager for Cornerstone Contractors. “There was a lot of opportunities on the street for projects to be able to bid on.”
But once the pandemic hit, work slowed down in many ways. The construction industry was never mandated to stop by state orders, but the economic impacts of the virus, and its effects on travel and supply chains meant some projects were slowed or halted.
“In Alaska, the biggest impacts we’ve had have been to our remote projects in remote communities,” said Kendall Nielsen, Vice President of Alaska Operations for Dawson Construction.
Many local restrictions on travel in smaller Alaska communities, and larger state restrictions, meant some workers had to wait up to two weeks after arrival before going to a work site, and Nielsen said in some cases that simply wasn’t worth the wait.
“An elevator installer, for example, comes out for three days,” he said. “That individual is not going to come in and quarantine for 14 days to then do two or three days worth of work.”
Even in Anchorage, without the complications of travel, some supplies became difficult to obtain.
“In states that fully shut down and blocked everything, had no critical supply chain stuff, those materials aren’t as available anymore,” Hornak said. “Or it was stuff that was completely sold out like the face masks and gloves.”
Now that the state is reopening, Hornak and Nielsen said work is starting to return to normal, or at the very least they’re able to get into a rhythm with the current regulations, but for Hornak, he added that a critical time for his company to bid on contracts was missed.
“February through April is bidding season, so if you’re not locked into work by the end of April, it’s gonna have impacts for the project itself,” said Hornak.
But he also said work is still out there. Cornerstone has a number of projects in the pipeline, and public entities like the Anchorage School District and the state have a number of projects in the works. Nielsen added that there’s also an emerging market for pandemic preparedness projects.
“We actually see some work that’s becoming available with the need to prepare quarantine spaces and things like that for the next round of the coronavirus,” he said.
And the next big bidding season begins in the Fall, so these new projects, along with ones from consistent partners will keep many companies afloat while they bide their time for the next season.
“We’ve really been impressed with how collaborative our customers have been,” Nielsen said. “We base our business largely on relationships, and it pays off in hard times like this.”