A Year of Challenges in the Metal Construction Industry

by Paul Deffenbaugh | 1 February 2022 12:00 am

In this month’s issue, we present our annual State of the Industry report, and you can quickly see from the insights provided by our experts that there are some noteworthy challenges. Like much of the world, the metal construction industry is facing difficulties with managing the supply chain, finding qualified labor, adjusting to rising prices, controlling costs and a myriad of other difficulties.

Here’s a little bit of what you can find in our report:

For leaders who see challenges as opportunities to solve problems and get better, opportunity abounds.

Alex Carrick, chief economist of ConstructConnect, takes a look at growth projections by market and points out where there may be opportunities as well as markets that may decline over the next year. Ken Simonson, chief economist at the Associated General Contractors of America (AGC), gives us insight on what contractors are thinking from the AGC 2022 Construction Hiring and Business Outlook survey. Generally, contractors are optimistic about 2022, though they face major difficulties caused by the supply chain disruption and labor shortage.

On a topic that is not being spoken about much, Rose Grant, AIA, CPCU, president of Rose Grant Architectural Services, Ellsworth, Ill., digs into the issue of rising property and casualty insurance because insurance companies have gotten behind the eight ball in payouts. For the last five years, they’ve paid out more than they’ve taken in. There are multiple reasons, but a big one is the huge increase in insurance events that caused more than a billion dollars in damage. The short of it is that insurers have had to settle more than they can cover. For contractors and building owners, that translates to higher premiums and tighter margins.

Tied to that is the issue of inflation, which has received a lot of press attention in the last few months, much of it misinformed. Kathryn Thompson, CEO of the Thompson Research Group, lays out how her firm is thinking about inflation in 2022. When you dig down below the surface, you discover a more nuanced picture than just a prices-are-rising-so-things-are-bad scenario.

At the Metal Construction Association (MCA), technical director Bob Zabcik, PE, explains how the group is helping to address the supply chain and labor shortage, but real effort is being made to react to code and standard changes being brought on by an increased focus on carbon embodiment of materials and other sustainability issues.

On the labor issue in particular, the National Center for Construction Education & Research (NCCER) has devoted itself to providing resources for training people in the trades and helping to attract young people to our industry. CEO and president Boyd Worsham puts the challenges in context and explains what has happened in the workforce development arena that is positioning us for better times ahead.

One of the huge growth areas of the metal construction industry is the opportunity provided by the increasing adoption of solar energy. Lowering prices is creating greater demand, and Rob Haddock, CEO and founder of S-5!, Colorado Springs, Colo., talks about the extra juice the Build Back Better bill could provide to this segment of the industry and why that’s important to the metal roofing market.

Take a run through our annual report. Yes, it’s long, but the value these experts bring to the table will help you manage your business and prepare for what appears to be a challenging year that also holds promise of significant rewards.

As Josh Quinter, construction attorney at Offit Kurman, says in his law column this month: “For leaders who see challenges as opportunities to solve problems and get better, opportunity abounds.”

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