ABC Outlines Merit Shop Priorities in Letter to the Biden Administration

To begin a dialogue with the Biden administration, ABC has sent a letter expressing our intentions to advance policies that keep workplaces safe and healthy, rebuild America’s infrastructure, create jobs for all Americans and help the U.S. economy continue to rebound from the COVID-19 crisis.

“ABC will be a constructive partner with the Biden administration as we tackle America’s many challenges head-on together and put in the hard work to defeat COVID-19, fix our broken immigration system, rebuild America’s crumbling infrastructure and lead America’s economic recovery. We look forward to continued dialogue with your administration and welcome the opportunity to discuss your economic policy agenda in greater detail in the coming weeks,” according to the letter from ABC President and CEO Mike Bellaman.

The 2021 STEP application is now open and ready for members to apply!

Changes to the application for 2021
Much of the application is the same as last year. You may see some small changes, but the four biggest changes this year are:

  1. The EMR will still be requested in the application, but will no longer be a threshold requirement to get to the Platinum or Diamond levels.
  2. Suppliers have their own set of Key Components this year. When a supplier applies, the Key Components page is different from the contractor Key Components page. STEP materials can be found on the STEP application homepage.
  3. ABC will no longer accept paper applications. All applications must be submitted online.

Please note that printed certificates this year will no longer use the word “award,” as we are moving towards the STEP certificate being described as a recognition.

We have two STEP webinars scheduled during February:

Get Involved With ABC National’s Safety Programs and See How Your Company Can Improve Its Culture
Tuesday, Feb. 16, 2021, at 3 p.m. ET

A Primer on the 2021 STEP Safety Management System:  A Step-by-Step Review of the Process
Tuesday, Feb. 23, 2021, at 3 p.m. ET

Nonresidential Construction Loses Jobs in January, Says ABC

The construction industry lost 3,000 jobs on net in January 2021, according to an Associated Builders and Contractors analysis of data released today by the U.S. Bureau of Labor Statistics. During the last nine months, the industry has added 857,000 jobs, recovering 77% of the jobs lost during earlier pandemic stages.

Nonresidential construction employment fell by 1,900 jobs on net in January. Heavy and civil engineering added 2,000 jobs for the month, but those gains were offset by losses in nonresidential specialty trade and nonresidential building, which lost 3,300 and 600 jobs, respectively.

The construction unemployment rate declined to 9.4% in January and is up 4 percentage points from the same time last year. Unemployment across all industries fell from 6.7% in December 2020 to 6.3% last month.

“Multiple forces are shaping nonresidential construction market dynamics, with the result that industry employment has flatlined,” said ABC Chief Economist Anirban Basu. “The construction industry began the COVID-19 crisis with significant backlog, according to ABC’s Construction Backlog Indicator. This industry also has the enviable status of an essential industry in America. That pre-existing strength in a number of public construction segments continues to translate into demand for workers.

“Not coincidentally, heavy and civil engineering, which encompasses road building and similarly situated segments, added jobs in January, said Basu. “At the same time, commercial real estate fundamentals have been hammered during the crisis by online sales and remote work. These factors have reduced demand for construction services in office, lodging and other commercial segments, especially with respect to new construction. Last month, this translated into fewer jobs in both the nonresidential building and specialty trade categories.

“Given the damage to many state and local government balance sheets, public construction spending is set to weaken going forward in conjunction with a number of key private segments,” said Basu. “That said, there are some areas of current and prospective strength, including fulfillment centers, data centers, manufacturing facilities and healthcare. But much of the industry’s fortunes during the balance of 2021 and into 2022 will depend on policymakers in Washington and their ability to deliver on their commitment to expanding the capabilities of the nation’s infrastructure. Absent a federal infusion of significant and much-needed investment, nonresidential construction is poised to be one of the weaker economic segments in terms of pace of recovery going forward.”

While State Construction Unemployment Rates End Poorly in 2020, Industry Continues to Perform Better Than Other Sectors Nationally

As the nation struggles with the economic effects from the COVID-19 pandemic, construction employment continues to perform better than many other occupational groups, according to a state-by-state analysis of U.S. Bureau of Labor Statistics data released by Associated Builders and Contractors. In December 2020, on a year-over-year basis, seasonally adjusted construction unemployment rates rose nationally and in 48 states, and national NSA construction employment was down 125,000 from December 2019. However, national construction employment was only 3% below its pre-pandemic peak in February 2020 on a seasonally adjusted basis.

By comparison, overall nonfarm payroll employment was down 6.5% from its peak in February 2020. The combination of the pandemic and winter weather resulted in an increase in not seasonally adjusted construction unemployment rates for the nation and most states.

The national NSA construction unemployment rate went from 5.5% in February 2020 to 9.6% in December 2020, up 4.1%. Among the states, only Nebraska and West Virginia had lower estimated NSA construction unemployment rates over that same period.
From December 2019 to December 2020, the rate rose 4.6%, from 5% to 9.6%. Over that same period, only two states—Nebraska and South Dakota—had lower rates.

“With the distribution of vaccines, there is now a path to defeating COVID-19 and returning the economy and the construction industry to its pre-pandemic levels. The speed with which we enter a new normal depends on how fast these vaccines are delivered and how much of the population is vaccinated,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “Federal spending to support the economy is also key. Spending on much-needed repairs to improve the nation’s infrastructure will benefit both the construction industry and the economy’s long-term growth prospects.”

Because these industry-specific rates are not seasonally adjusted, national and state-level unemployment rates are best evaluated on a year-over-year basis. However, due to the uncertainty caused by the pandemic, month-to-month comparisons are useful.
The national NSA construction unemployment rate was up 2.3% from November 2020 to December 2020. Since the data series began in 2000, the historical pattern of change in rates from November has been an increase every year. Among the states, 45 had higher estimated construction unemployment rates than in November, four had lower rates, and one was unchanged (Montana).

Click here to view graphs of overall unemployment rates and construction unemployment rates showing the impact of the pandemic, including a new graphing tool that creates a chart for multiple states; alphabetical lists and rankings; and monthly and annual state unemployment rates.

Construction Backlog and Contractor Optimism Rise to Start 2021

Associated Builders and Contractors reports that its Construction Backlog Indicator rose to 7.5 months in January 2021, an increase of 0.2 months from its December 2020 reading, according to an ABC member survey conducted from Jan. 20 to Feb. 2. Despite the monthly uptick, backlog is 0.9 months lower than in January 2020.

ABC’s Construction Confidence Index readings for sales and staffing levels increased in January and remain above the threshold of 50, indicating expectations of growth over the next six months. The index reading for profit margins remained below that threshold, slipping to 47.5 in January.

“Though nonresidential construction spending has continued to recede for the better part of a year, the growing consensus is that the next six months will be a period of improvement,” said ABC Chief Economist Anirban Basu. “While backlog is down substantially from its January 2020 level and profit margins remain under pressure, more than half of contractors expect sales to rise over the next six months and nearly half expect to increase staffing levels.

“The anticipation is that the second half of the year will be spectacular for the U.S. economy from a growth perspective, which will help lift industry fortunes as 2022 approaches,” said Basu. “But that is not the entire story. There are also public health and supply chain considerations. During the COVID-19 pandemic, many contractors experienced repeated interruptions in project work. Acquiring key materials and equipment has also become more difficult, with occasional price shocks for certain commodities. With vaccinations proceeding apace, many contractors will benefit from fewer interruptions going forward and the restart of many postponed projects.”

ABC Statement on Senate Committee Vote Approving Nomination of Mayor Walsh as Labor Secretary

Associated Builders and Contractors President and CEO Michael Bellaman released the following statement on the vote by the U.S. Senate Health, Education, Labor and Pensions Committee to approve the nomination of Mayor Marty Walsh as secretary of the U.S. Department of Labor:

“Mayor Walsh knows the construction industry and its workforce, so I believe we share common ground in developing well-qualified craft professionals and creating work environments that prioritize safety and total human health. In his Senate committee hearing, Mayor Walsh said that he would be collaborative and a listener, so ABC looks forward to working with him on policies that benefit the industry as a whole, rather than favoring one constituency over another or excluding the majority of our workers and contractors from rebuilding America. More than 87% of construction workers choose a career in a nonunion environment—evidence that the merit-based marketplace rewards diversity of ideas, drives innovation and creates value for individuals, the industry and the nation.”