USA, CANADA & MEXICO are forecast to see overall negative or minimal GDP growth for the balance of 2020, down sharply due to COVID-19:
In the US, the States of Michigan, Massachusetts, New York New Jersey and Pennsylvania saw 30% to 50% of their construction workers unemployed in the last 3 month. As a point of reference, in Florida 4% of construction workers were laid off, versus 41% in New York State due to COVID-19.
The good news is that majority of US States are now back in business. Safety and worker protection has really become a # 1 issue on construction sites in the last couple of months.
The economies of USA, CANADA & MEXICO will slow down dramatically in the remainder of 2020, as these Governments wrestle with the impact of the Coronavirus on their economies. Regrettably, the Coronavirus has the potential for all planned or in progress construction projects to be delayed, or worst case cancelled.
Owners / Operating Companies are reducing 2020 CAPEX budgets anywhere from 10% to as much 50%, unfortunately will translate into reductions in staffing levels across the Petro-Chemical / Power Industry.
Engineering & Architectural firms are reporting a dramatic fall off of new orders as we move into the 2nd half of 2020.
The US Government is set to come up with a third relief, bailout / stimulus package costing a massive $1.5 Trillion in July or August. This relief package is aimed at assisting US industry & US citizens.
US construction labor costs should remain unchanged in the 2nd half of 2020. Open Shop hourly rates could see a decline of 2% to 5%, these rates are decided many times on what the local market will bear. Union hourly will remain fixed. However, the overall cost of labor on a project will increase because it will take additional man-hours to complete the work effort. Construction productivity will decline, translating to more additional direct field and construction field in-direct man-hours.
Infrastructure, Residential & Commercial Construction is set to see a significant slowdown if this pandemic continues past June or July. COVID-19 will result in many cancelled projects, such as shopping malls, offices, hotels, airport, sports stadiums and other non-essential facilities. Oil & Gas facilities are expected to take a big hit in the remainder of 2020.
The positive news with COVID-19 will be increased spending on Pharmaceutical, Bio, Vaccine production, Healthcare and R&D facilities for the remainder of 2020.
Owners & construction organizations are struggling with restarting projects & the need of worker testing, obtaining PPE (masks / gloves) & developing necessary cleaning procedures & safety requirements.
Most US States are getting the go ahead to commence construction activities as we move into the 2nd half of 2020.
Canada & Mexico construction sectors will experience a similar situation the US is experiencing, the construction sectors are set to contract by 15% to 25% for the remainder of 2020.
Quebec, British Colombia and Ontario recently removed restrictions on essential construction work, which includes hospitals, pharmaceutical food production and essential manufacturing faculties. Mexico is still seeing a big increase in COVID-19 cases. Mexico is allowing essential and non-essential construction work to proceed in states that have few CONVID-19 cases. Many manufacturing and other industrial sectors can open up work activities if they follow pre-established Government social distancing, health and safety regulations.