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Nevada construction industry still at work during pandemic

Updated August 5, 2020 - 9:28 am

When Gov. Steve Sisolak announced a statewide shutdown of all nonessential businesses on March 17, I had strong concerns about my health, my business outlook, the future of Nevada and our country. Was there going to be a future? And, what will that look like? My thought process spread to every avenue in my life. I was seeing the coronavirus outbreak spreading across the U.S., impacting nearly every industry, and I knew the construction sector would not be immune from its effects.

My mind immediately went to the Great Recession (2007-2009), when more than 40 percent of construction subtrades left Las Vegas. Some changed industries and some companies didn’t build for years. Back during the previous downturn, Nevada’s construction industry posted the largest percentage decline in jobs in the state when it shaved nearly two thirds of its workforce. It took years for the commercial construction industry to get back on our feet after the Great Recession.

This is particularly significant considering it is estimated that every construction job generates another 2.25 jobs, directly or indirectly.

But then I realized that it is troubling and uncertain times that create tremendous business opportunities. One thing is certain: Companies that innovate will have an edge. We are going to see which businesses were running on thin margins pre-pandemic. Worst-case scenario for financially stable construction companies is we lick our wounds and go into 2021.

Most construction trades didn’t miss a beat even if they had a few jobs paused or canceled. Now, many are back on.

According to an Associated Builders and Contractors analysis of data released on July 2 by the U.S. Bureau of Labor Statistics, the U.S. construction industry added 158,000 jobs net in June. During the past two months, the industry has added 591,000 jobs, recovering 56 percent of the industrywide jobs lost since the start of the pandemic. Nonresidential construction employment added 74,700 jobs net in June. This data is good indication that things aren’t looking as dim as I initially thought on March 17.

Other jobs have paused but not been canceled in the subtrade and general contractor markets. Q3 is looking decent, and Q4 is filling in nicely with jobs that have unpaused, or just on track to get built.

It appears like it is going from 50 to 75 percent in the past six or seven weeks now. I am pretty excited to have things moving.

A huge difference between the pre-Great Recession versus pre-coronavirus pandemic is the health of the economy going in. There’s a lot less debt and borrowing; however, if lenders aren’t lending, then there is very little work. So far, it appears this is not (not yet, anyway) a financial crisis. So we remain optimistic that if lenders will lend to projects that make sense (like the industrial/warehousing and distribution assets class), then the near future of the construction market in Las Vegas will have some life.

Construction is moving forward. However, as companies and governments continue to advise employees to work from home; the construction industry, in which remote work doesn’t translate to jobsite progress, could be affected by supply interruptions brought on by the COVID-19 pandemic. That could affect project timelines. This does pose some future uncertainty.

I’m not so much worried about the near term as I am concerned about the long-term effects of this crisis, especially if it is still going on a year from now. I anticipate the downturn will have a trickle-down effect on our colleagues in building and related industries.

It is our goal in the construction industry to remain essential and to keep our workers employed.

I cannot stress enough to colleagues that wearing masks, social distancing and an increased focus on on-site sanitation are still our best weapons. Tradewinds Construction has implemented the necessary COVID-19 protocols issued by the Centers for Disease Control and Prevention and Nevada OSHA to continue the health and safety of our employees and clients. Not following these safety protocols could not only endanger your business but could also end up shutting down every construction jobsite in Nevada. Maintaining these safety protocols means: We all stay at work. We are all riding on each other’s performance.

Jeffrey Vilkin is the president and CEO of Tradewinds Construction. Founded in 1988, Tradewinds Construction is a Las Vegas-based tenant improvement general contractor and multiscope subcontractor, housing four separate operating divisions under one roof.

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