By Ethan Duran

The Daily Reporter

With workforce woes and construction costs continuing to be the main headaches for contractors, they still have backlogs – public infrastructure in particular, according to an industry economist.

Associated Builders and Contractors chief economist Anirban Basu spoke Wednesday during a webinar for Construction Executive. While keeping a pulse on the overall economy and trends, he discussed current challenges, expected struggles and industry prospects.

Basu predicted the Federal Reserve might cut interest rates in September according to the bond market. The consumer price index for all items was up 3.3 percent over the past 12 months, and May 2024 construction inputs were up 2.1 percent year over year, according to federal statistics.

Basu said he was surprised by the state of the greater economy but added he thought the landing would still be rough when considering credit card debt, job openings and the Fed rate.

The construction backlog was over eight months for contractors, according to the latest ABC index. However, as interest rates start to drop, Basu said his guess is that the backlog would start to decrease in 2026 as demand softens.

Same industry problems

A survey revealed that 60 percent of responding contractors named the skills gap and worker shortages their leading challenge, according to ABC and Sage Policy Group, Basu’s firm based in Baltimore. Availability of financing followed at 17 percent and insufficient demand was at 11 percent.

There were 8.1 million job openings in the U.S. in May 2024, according to federal statistics. Employers looking for construction workers were competing with franchisees and warehouse service providers. Even with the strength of infrastructure projects, having the number of workers on the job site was still a question, Basu noted.

Construction inputs were also higher than bid prices, as inputs were 38.8 percent and bids were 36.2 percent in May 2024, according to the U.S. Bureau of Labor Statistics.

The increase of input prices outstripped the growth of bid prices, Basu said, suggesting it wouldn’t be easy to continue to support the margin. Contractors need to raise their bid prices significantly to keep up with construction costs.

Infrastructure, infrastructure, infrastructure

Nonresidential construction makes up 37 percent of spending by subsector, according to data from the U.S. Census Bureau. The biggest chunk of spending is manufacturing with 198.1 percent, followed by sewage and waste disposal at 66.8 percent and water supply at 65 percent. Due to government spending via the Infrastructure Investment and Jobs Act and the CHIPS and Science Act, the public sector was still going strong.

“It’s still the era of infrastructure,” Basu said, noting that many of the recipients of CHIPS and Science Act funds were megaprojects. “There is a lot of public spending, so sewer and water supply, health care and highway and street are all high.”

Because a lot of federal money offered to health care systems during the pandemic has dried up, he noted he expected some softening in that area.

Changes in real estate demands

Meanwhile, the numbers of private developments such as multifamily or office buildings are also declining, according to the latest Architecture Billings Index – a lead indicator of projects in the pipeline. In May the index was at 42.4, which Basu said was the worst in years. The Midwest region was hit hardest at 41.7.

With the work-from-home model still popular among both employers and employees, Basu said this will continue to soften the need for office buildings. However, demolition contractors might have work ahead when banks decide offices are no longer worth maintaining, he added.

Office vacancy in the U.S. was 13.8 percent in the first quarter of 2024, according to CoStar.

One of the bright spots in the commercial construction sector will be data centers, Basu said, as the federal government unbundled the facilities from office construction. Reshoring supply chains, alternative energy and projects like electric vehicle and battery factories will still be muscular as American and foreign company owners focus on North America, he added.

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GREENSBORO, N.C. — 91��Ƶ, the parent company of the Daily Journal of Commerce, and source of business insights, data-driven marketing solutions and events across more than 40 media and research brands, has acquired ColoradoBiz, the voice of business statewide for more than 50 years, the companies announced on Thursday.

Founded in 1973, ColoradoBiz is the largest business publication dedicated to serving the state of Colorado. The media brand spans online and offline properties that keep readers informed of the latest developments in the state. Audience research shows that 87 percent of ColoradoBiz readers take action after seeing its advertising.

“Business is booming in Colorado, and we see an opportunity to accelerate growth in ColoradoBiz through this acquisition by leveraging the power of 91��Ƶ’s audience platform and best-in-class capabilities,” 91��Ƶ President and CEO Hal Cohen said. “For decades, ColoradoBiz has been an indispensable part of the business community in the Centennial State. We look forward to delivering even more value to readers and advertisers in the years ahead.”

Following a significant digital transformation, 91��Ƶ has been increasing its appeal to business executives and marketers by strategically expanding its media footprint to encompass more growth markets and industries across the U.S. The acquisition of ColoradoBiz, with its long track record of engaging a statewide audience of discerning decision-makers and business owners, increases the company’s reach and presence in the Rocky Mountains region. 91��Ƶ is a portfolio company of Transom Capital Group, an operationally focused private equity firm in the lower middle market.

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The construction industry is undergoing a significant transformation as it embraces the benefits of artificial intelligence (AI). AI technologies such as machine learning, computer vision, and natural language processing are being used to automate construction processes, increase safety, and improve efficiency. Following is a brief look at the top 10 uses of AI in the construction industry.

1. Building Information Modeling – AI-powered BIM software enables construction professionals to design and visualize complex structures, manage project schedules, and estimate costs accurately. BIM software also integrates data from various sources to provide a single source of truth for all stakeholders.
2. Autonomous equipment – Self-driving construction equipment featuring sensors and cameras can operate autonomously and perform tasks such as excavation, grading, and paving. Autonomous equipment is more efficient, safer, and reduces labor costs.
3. Predictive maintenance – AI algorithms can analyze data from equipment sensors to predict when maintenance will be required. This enables construction companies to schedule maintenance before equipment failure occurs, reducing downtime and costs.
4. Safety monitoring – Computer vision algorithms can analyze video feeds from job sites to detect safety hazards and alert workers in real time. Safety monitoring can help prevent accidents and improve safety on job sites.
5. Quality control – AI-powered inspection systems can detect defects in materials, identify noncompliant construction practices, and ensure compliance with safety regulations. Quality control can improve the quality of construction and reduce costs tied to revisions.
6. Resource optimization – AI algorithms can analyze data on weather, traffic, and construction schedules to optimize resource allocation. Resource optimization can reduce delays, increase productivity, and save costs.
7. Risk management – AI algorithms can analyze data on construction risks such as weather, labor shortages, and material availability to assess the likelihood of delays and cost overruns. Risk management can help construction companies mitigate risks and ensure project success.
8. Energy efficiency – AI-powered energy management systems can analyze data on building energy use to optimize energy consumption, reduce costs, and improve sustainability. Energy efficiency can help construction companies achieve green building certification and reduce carbon emissions.
9. Augmented reality – AR technology can overlay digital information on real-world project environments to help workers visualize designs, detect safety hazards, and facilitate communication. AR can improve productivity and reduce errors on job sites.
10. Chatbots – Algorithms for processing natural language can enable construction companies to deploy chatbots to assist with customer service, answer FAQs, and provide real-time project updates. Chatbots can improve customer satisfaction and reduce response times.

In conclusion, AI technologies are transforming the construction industry by improving safety, efficiency, and sustainability. By embracing AI, construction companies can optimize resources, reduce costs, and deliver better outcomes for stakeholders.

Editor’s note: This article was assisted by an AI engine and reviewed, fact-checked and edited by our editorial staff.

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By Ethan Duran
The Daily Reporter

Fuel, lumber, steel and trucking costs were on the decline while materials like copper, aluminum and concrete rose last month in the latest Associated General Contractors of America analysis. Experts within the association said some construction input costs dropped in December in a look at the latest Bureau of Labor Statistic data.

The producer price index for material and service inputs to new nonresidential construction fell by 1.8 percent for the sixth time in seven months, and the PPI for goods sank 2.7 percent — a drop like this last seen in November 2008, association officials said. However, materials and services were up 7.2 percent year-over-year and slightly outpaced a 6.5 percent increase in the consumer price index, which is the crystal ball of inflation.

Construction input costs were 7.9 percent higher than they were a year ago and nonresidential construction input prices were 7.6 percent higher, an Associated Builders and Contractors analysis showed. ABC‘s top economist Anirban Basu said the recent short-term price drops had both good and bad effects on the construction economy.

“This Producer Price Index data represents another positive development on the inflation front,” Basu said during a recent webinar. “However, this is both good and bad news. Recent consumer and producer price releases indicate that inflation is fading, though it remains well above the Federal Reserve’s 2 percent target. Should inflation continue to abate, the Federal Reserve may be able to stop increasing interest rates sooner than anticipated. Interest rate-sensitive segments like real estate and construction would be among the primary beneficiaries. Contractors are currently maintaining their longest backlog since 2019, according to ABC’s Construction Backlog Indicator.”

Falling prices may also indicate a shaky economy in the U.S. and other parts of the world, Basu said. “Moreover, there could be bad news on inflation in the months ahead. War continues in Eastern Europe and the commodity use-intensive Chinese economy is in the process of reopening. Though there is evidence of improving supply chain functioning and moderation in input prices, contractors should not be tempted into complacency,” he added.

The PPI for new nonresidential building construction, the measure of the price contractors would bid to build a fixed set of buildings, was flat for the month and up 19.4 percent year-over-year, the AGC said.

New residential construction PPI inputs fell 1.2 percent for the month but increased 6.9 percent year-over-year, followed by one-month declines for four product groups:

• Diesel fuel was down nearly 30 percent, but up 20 percent year-over-year;
• lumber and plywood were down 3.7 percent for the month and down 20 percent year-over-year;
• steel mill products were down 2.7 percent and down 29 percent, respectively; and
• truck freight transportation was down 1.7 percent and 8.2 percent year-over-year.

Meanwhile, copper and brass mill shapes had a PPI increase of 1.5 percent in November, but prices were down 3.6 percent year-over-year, AGC’s analysis showed. Ready-mixed concrete was up 1.4 percent for the month and 13.6 percent year-over-year and aluminum mill shapes were up 1.3 percent for the month and 5.7 percent year-over-year.

AGC found some concrete steel producers posted price increases in December for hot-rolled coil, and commercial retail tile producers announced price increases up to 8 percent in February.

U.S. hotel construction saw a slight increase in the last few weeks but plans for future rooms fell 16 percent, according to STR data analytics. Places like New York City, which has the most rooms under way, and Nashville were showing signs of a slowdown.

Single-family housing starts fell 1.4 percent in December at a seasonally adjusted annual rate from November and 22 percent year-over-year, the Census Bureau reported. Multifamily starts fell nearly 20 percent, with more permits out for the month but less compared to other years, leading analysts to suggest construction will decline when current projects are done. There were 926,000 multifamily units underway in December across the U.S.

The Federal Reserve projected a flat course for economic activity from mid-November to Jan. 9, according to its latest Beige Book report. “Housing markets continue to weaken, with sales and construction declining across Districts,” the central bank said. “Commercial real estate activity slowed slightly, on average, with more notable weakening in the office market. (Some) bankers said higher borrowing costs had begun to dampen commercial lending.”

Meanwhile, union membership in the industry dipped by 0.5 percent or 5,000, from an annual average of 1,024,000 in 2021 to 1,019,000 in 2022, the Bureau of Labor Statistics reported. There were 8,671,000 people employed in the construction industry last year, which is a 6.3 percent increase from 2021, but unionization rates still declined between years. The total of workers represented by unions was 1,076,000 (or 12.4 percent) in 2022, compared to 1,112,000 (or 13.6 percent) in 2021.

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Violating Occupational Safety and Health Administration rules will come at a higher cost now that the Department of Labor has increased fines. The newly increased penalties went into effect on Tuesday.

OSHA‘s maximum penalties increased from $14,502 per violation to $15,625 per violation for serious and other-than-serious violations, the DOL stated. Penalties for failing to abate increased to $15,625 per day beyond the abatement rate from $14,502. The maximum penalty for purposeful or repeated violations rose from $145,027 per violation to $156,259 per violation.

Minimum fines for willful violation increased from $10,360 to $11,162, according to the final rule of federal civil penalties adjusted for the cost of living in 2023.

Legislation that Congress passed in 2015 required agencies to publish “catch-up” rules that increase civil fines and adjust for inflation by Jan. 15 every year, officials stated.

“In 2015, Congress passed the Federal Civil Penalties Inflation Adjustment Act Improvements Act to advance the effectiveness of civil monetary penalties and to maintain their deterrent effect,” OSHA stated. “Under the Act, agencies are required to publish “catch-up” rules that adjust the level of civil monetary penalties and make subsequent annual adjustments for inflation no later than January 15 of each year.”

Because the date this year fell on Sunday and Monday was a federal holiday, officials launched fine increases on Tuesday.

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By Ethan Duran

91��Ƶ Newswire

Contractors are looking forward to pursuing public funding and projects in 2023 after dealing with supply chain and workforce challenges last year, a survey by the Associated General Contractors of America found.

A total of 42 percent of construction firms expect higher value from bridge, highway and transportation projects this year, according to the survey conducted by AGC and software company Sage. Ken Simonson, AGC’s chief economist, said water and sewer projects and federal projects were just behind at 38 percent and 37 percent, respectively.

“While contractors remain upbeat about the available dollar value of projects to bid on in 2023, their expectations have definitely shifted compared to last year,” he said during a webinar on Wednesday.

However, only 5 percent of respondents said they worked on projects funded by the Bipartisan Infrastructure Law signed by President Joe Biden in November 2021, Simonson said. A total of 6 percent of respondents won bids through the law but haven’t worked yet, and 5 percent have bid but haven’t won awards yet.

Meanwhile, power and other health care projects both scored at 28 percent in AGC’s survey – the highest expectations among private sector categories. Contractors were optimistic about hospital projects and public buildings, which scored at 23 percent each. Both K-12 and higher education construction were at 16 percent.

Lodging, private offices and retail construction still looked bearish, Simonson said, with readings of minus 4 percent, minus 21 percent and minus 22 percent, respectively. Respondents rated manufacturing construction 14 percent for 2023, compared to 27 percent a year ago. Data centers and warehouses joined manufacturing, both down more than 30 percent year-over-year.

Despite the optimistic readings, contractors were less confident about prospective growth than in 2022, Simonson said. All but three project types had fewer positive readings than last year, and multifamily and warehouse construction took the hardest hits – down 31 points from 2022.

A total of 69 percent of respondents expected their headcount to increase over the next 12 months, but 58 percent said they expect hiring to be a challenge this year, AGC data showed. Of the construction firms that responded, 11 percent expect their workforce to decrease and 15 percent expect to hire workers more easily.

The number of contractors who had difficulty filling some or all salaried hourly craft positions came in at 80 percent, while 8 percent said they had no difficulty, Simonson said. The difficulty with increasing headcount was prevalent across both union and open shop firms.

Simonson said the lack of available labor likely explains why 72 percent of firms increased base pay rates more than in 2021. This was an increase from the 62 percent of firms who boosted pay more in 2021 than in 2020, and only 7 percent of firms didn’t increase pay, incentives or benefits in 2022, down from 12 percent in 2021. A total of 33 percent of respondents introduced or increased incentives and bonuses last year, AGC data showed.

Alongside headcount woes was supply chain issues, as only 9 percent of contractors reported not facing significant supply chain problems in 2022, AGC data showed. Many respondents accelerated purchases after winning contracts and most turned to alternative suppliers to deal with supply chain problems, Simonson said. Nearly half specified alternative materials or products and close to one quarter stockpiled items before winning contracts, he added.

Many contractors reported project delays or cancellations in 2022: 39 percent said a postponed project was rescheduled, 36 percent had postponed or canceled a project without rescheduling, and 13 percent of firms have already canceled or postponed a project that was scheduled to begin in the first half of 2023, Simonson said. The main culprit for project delays was rising costs in different areas, including construction, financing and insurance, half of survey respondents said.

A total of 12 percent of contractors canceled or postponed projects due to owners having less funding available and 8 percent said cancelations and postponements followed a delay in the likely completion date, Simonson said. Because of supply chain and workforce challenges, many firms turned to technology to increase their efficiency, he added.

In AGC’s final outlook report, a total of 74 percent of respondents said the possibility of an economic slowdown or recession was their biggest concern. Material costs (73 percent), insufficient labor and contractors (70 percent) and rising interest rates or financing costs (67 percent) followed.

Between 68 percent and 91 percent of construction firms choosing from 15 types of technologies planned to keep their technology investment about the same as last year, Sage Vice President of Construction and Real Estate Dustin Stephens said during the webinar. Of nearly a third of firms who wanted to increase tech investments in 2023, the top categories they picked were document management software and project management software.

“As construction firms seek more flexibility and anytime, anywhere access from their solutions, we have seen more firms turning to cloud-based technologies the past few years,” Stephens said.

Project management was the most popular program for cloud-based technology, with 57 percent of firms using it, he added.

For the infrastructure law and federal projects to benefit the industry, action will need to come from the top of the federal government, AGC CEO Stephen Sandherr said. “To do that, they will need to address much of the regulatory and permitting uncertainty that muted the hoped-for benefits of the Bipartisan Infrastructure Law in 2022. For example, the Biden administration will need to resolve the significant uncertainties that exist around the Buy America provisions within the Bipartisan Infrastructure Law.”

The administration hasn’t settled on a uniform interpretation of requirements within the law and federal agencies will likely have inconsistent interpretations of which materials are covered, Sandherr added.

“This regulatory uncertainty will make it harder for state and local officials to move forward with vital infrastructure projects, since so many of the components needed could potentially be tripped up by the Buy America requirements,” he said.

The association also pushed for labor and tax provisions included in the Inflation Reduction Act, as well as immigration reform and investments in career and technical education programs.

“We will continue to be vigorous advocates for the industry in Washington (D.C.) and with public officials across the country,” Sandherr said. “The bottom line is we will do everything in our power to make sure that 2023 is a successful one for the industry, our members and the tens of thousands of men and women that they employ.”

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By Ethan Duran

The Daily Reporter

The construction economy next year will be marked with lingering inflation linked with strong demand and growth, according to Associated Builders and Contractors top economist Anirban Basu.

Looking ahead to 2023, supply will struggle to keep up with demand as the economy remains unbalanced by international conflict and coronavirus-related problems, so-called “purveyor of doom and gloom,” Basu said during a Construction Executive webinar on Wednesday. He also forecasted higher-than-average economy-wide inflation and interest rate increases next year.

The economist blamed market wage pressures for broadening inflation and the Federal Reserve for enforcing low interest rates from 2020-21 to a costly effect. Inflation was up 7.1 percent year over year in the latest Consumer Price Index.

“The worst of inflation is behind us, but it will be problematic for years to come,” Basu said. “It started in 2021 due to supply chain �������ܱ��.”

Russia’s invasion of Ukraine drove up energy prices and China’s COVID-19-related quarantines impacted prices of construction materials. Global inflation was higher than 2021’s forecasts: The World Economic Outlook in October 2022 was nearly 4 percent – higher than previous predictions.

The U.S. economy was “overheated” because of economic growth and high inflation, Basu said. Gross domestic product was up 2.9 percent in the third quarter and the economy has good momentum going into 2023 but not enough people were able to do the work, he added. In the latest U.S. labor force participation rate data, only 62.1 percent of able bodies were working.

“This is one of the things I didn’t guess,” the economist said. “I thought people wanted to pay bills amid high food and gas prices. Airfare prices are up now.”

Basu pointed to the lack of affordable day care facilities as a possible culprit and said if families were unable to find remote work, they would stay out of the job market altogether.

The Bureau of Labor Statistics found construction added up to 126,000 jobs over two years, which Basu said was “almost nothing.” Responding to a webinar poll, 56 percent of nearly 600 attendees said their leading challenge was finding skilled workers.

Numerous baby boomers hitting their 70s left the industry without many young people to replace them, Basu said. A slowdown of legal immigration and ongoing undocumented entries into the U.S. have created a pair of problems, he added.

Homebuilding stumbled under high mortgage rates, which were at 6.33 percent for 30 years and 5.67 percent for 15 years, data from Freddie Mac showed. Building permits for single-family homes were close to levels last seen in 2007 along with fewer home sales, U.S. Census Bureau data showed.

“Home sellers kept prices high as the economy changed and buyers want to buy low,” Basu said. “Eventually they will have to take their prices down or take homes off the market.”

While lodging construction was down in the last round of census bureau data, public construction was up thanks to federal grants for infrastructure for the next five years, Basu said. Nonresidential contractors found more demand for manufacturing projects, spurred by government incentives like the CHIPS and Science Act.

There would be a catch to the incentive as plants were slated for only cities like Phoenix, Columbus, Ohio, and Syracuse, N.Y., Basu said. However, it was a sign of production coming back to American shores, he added.

Americans will probably feel the bite of interest rate hikes in the future, Basu said. Research showed the economy doesn’t feel interest rates going up for 8-12 months, he added. The Federal Reserve moved the rate up 0.5 percent on Wednesday, the sixth time it raised rates in 2022.

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By Alex Baumhardt

In some Oregon school districts, turf fields and lawn mowers were necessities to overcome the pandemic and get schools reopened.

Others used emergency relief money to retrofit buildings with ventilation systems, add laptop computers for students and pay for online teaching.

But the state still holds more than $1 billion meant to help school districts address pandemic-related issues. 

Since March 2020, Oregon has been allocated $1.7 billion in emergency relief funding from the federal government to get students back in classrooms, and to get them caught up on their education after school closures. 

Now, more than a year later, most of that money remains unspent.

School districts so far have been reimbursed for about $222 million in emergency relief projects, according to the Oregon Education Department. That means just under 8 percent of all dollars have made it back to districts.

The bulk of that money has gone to staff, technology and capital projects – getting kids laptops and wifi, upgrading ventilation systems and adding more classrooms to encourage social distancing. 

But emergency purchases also included weight room equipment, bleachers and playgrounds. 

Districts must spend at least $201 million of Oregon’s latest relief money to combat learning loss over the next three years, but data from the Education Department show that less than 1 percent has been distributed so far for that purpose.

The reasons behind what districts are buying, and when, are complex, but they have broad latitude in using the extra money.

The Elementary and Secondary School Emergency Relief Fund

The Elementary and Secondary School Emergency Relief Fund was signed into federal law in ​​March 2020 as school buildings in many states were closing and classes shifted online. 

The first round of money was ready to go out to states immediately for buying personal protective equipment for staff and students who had to remain in school buildings, and to help schools pay for the transition to online learning. That included laptops for students, new online teaching software, network security upgrades and internet hotspots for families that otherwise had no internet access.

It also paid for more teachers, substitute teachers, counselors and support staff. 

The money was awarded from the federal government to the state Education Department, which reimburses districts for their purchases. Purchases over $5,000 must have prior approval from the department.

Oregon’s share of funds in that first round was $121 million. 

Most of the state’s 216 school and education service districts have claimed some portion of the funds and to date, more than $100 million of that first round funding has been spent. 

The second and third rounds of funding came in December 2020 and March 2021. Oregon was allocated $499 million in the second round to spend on getting schools ready to reopen. 

In the third round, the state was allocated $1.1 billion. 

It was additional money for school reopening that came with a new federal mandate – school districts had to spend at least 20 percent on combating learning losses. Schools have until 2024 to spend the latest round of money.

Little to learning loss so far

Of the $1.1 billion available to Oregon districts in the third round, about $18 million has been distributed so far, according to the state Education Department. That has gone to paying for summer school programs, salaries, payroll costs, retirement costs and technology and supplies. 

Districts are allowed to use the relief funds to pay for new teachers, and boost pay for current employees for taking on additional work during the pandemic and to retain them.

Of the $202 million set aside to help students catch up on their education, about $1.4 million – less than .05 percent – has been distributed so far, according to the Education Department. 

Cynthia Stinson is senior manager of federal investments and pandemic renewal at the state Education Department. She said timing is the issue with the relatively slow payout for extra learning programs.

She said most schools haven’t had to draw on the emergency funds yet to pay for tutoring, counseling, afterschool and remediation programs. Many only just recently submitted budgets to meet an October deadline set by the federal government, and some are taking a long-range approach with the money, having been given three years to spend it. 

In an email, Marc Siegel, communications director at the Education Department wrote, “It is important to note that the three relief acts came in very short succession.” 

Siegel said many districts are still spending previous rounds of money and added, “We are only a little over three months into the school year.” 

But Oregon schools have not wasted much time getting capital projects funded, some of which include renovating running tracks, getting weight training equipment and upgrading playgrounds.

Stinson said districts have been given flexibility on what they can buy. 

The Education Department doesn’t track every rejection of a district’s requested spending, but said it turned down requests for baseball and football scoreboards, some requests for bleachers, the request for a vehicle to use for student outreach and one request for a roof replacement.

“One of the goals is also to emerge stronger post pandemic,” Stinson said of the emergency funds. “As we talk with districts, and understand what it might really mean for a rural or frontier district in Oregon to redo a playground, it’s not only for all of the kids in school, but it’s the only playground in the community, right?”

The Capital Chronicle emailed 150 Oregon school district superintendents seeking information about how they used their latest round of relief dollars. Of those, 30 superintendents or district representatives responded. 

Three wrote that they had been posting reports on their district websites about where their relief dollars were going, six sent spreadsheets detailing projects and a few said they hadn’t claimed any of the latest funding but planned to.

Jeff Clark, Amity School District superintendent, said so far most of his district’s relief dollars have gone to improving learning conditions.

“We have some older buildings with poor ventilation. Supplies, materials and equipment would be next on the list,” he wrote via email. 

Clark said the district is using dollars from the state’s Student Investment Account to help recover lost learning. That’s part of the $1 billion a year Oregon schools get under the Student Success Act that was signed into law in 2019. Several district superintendents said they preferred using that more stable funding instead of short-term federal help to pay for more staff and for programming to combat learning loss.

In the Forest Grove School District, emergency relief dollars are being used for reading and math interventions and tutoring middle schoolers, summer school activities and social and emotional support staff, according to David Warner, district communications director. 

In Hermiston, Superintendent Tricia Mooney said the district wants to use the latest round of relief money to support summer school programs to help get students caught up. 

In North Bend, school officials plan to ask for $3 million to help combat learning loss. In the Siuslaw School District, they are planning to ask for about $691,000 to combat learning loss over the current school year, according to Superintendent Andrew Grzeskowiak. 

Among most of the district leaders who responded, transitions to online learning, staff, payroll and retirement, along with capital expenses and supplies were among the biggest expenses incurred so far.

HVAC and parking lots

In an effort to get schools fully reopened in the fall, the Klamath County School District initiated construction projects with the emergency funds.

The district updated HVAC systems in an elementary school and high school, and added extra classrooms to buildings so there’d be fewer kids in each room. They also added new turf fields to several schools and resurfaced a parking lot. 

Despite being short staffed, like most districts in the state, Superintendent Glen Szymoniak said the short window to use federal relief aid meant he wasn’t going to use it to do temporary hires of teachers and counselors and programs that couldn’t be sustained.

“With money that only lasts a couple years, you do projects. That’s the golden rule right there. You don’t use it to hire people and cut them loose in a few years. It gives you a bad reputation and it’s just a terrible way to treat people,” he said. 

Rather than hiring new people, he used some of the relief money to pay employees to surrender vacation time.

“We’re buying that off at a bit of a higher rate,” he said, “so that we can have them stay in the classroom.”

He also bought lawn mowers and floor cleaners that were faster and more efficient than what he had, allowing grounds staff and janitors more time to complete other sanitation and maintenance work and negating the need to do more hiring. 

“Custodians have floor scrubbers, now there’s time to sanitize. They weren’t sanitizing like this before,” he said. “Principals with tight budgets would buy cheap mowers. Well then, none of the other work gets done. With a high capacity mower [custodians] have more time to do other stuff.”

He said investments like the turf fields and running tracks were important for sustaining school programs that students needed during the pandemic.

“The first turf I applied for was for Chiloquin,” Szymoniak said of the elementary school in his district. Because of drought and the resulting water restrictions, “If there’s not enough runoff and the lake level is a certain height they shut off the irrigation for farmers, ranchers and for us. In Chiloquin, our playgrounds turn to dust,” he said. 

The turf became an essential place for students to play, have for recess and for extracurricular activities. 

Szymoniak said he’s committed to investing more than required into activities that combat learning loss. He said his district is already spending and will continue to spend upwards of 38 percent of the district’s relief dollars on learning loss. So far, the district has set up after-school tutoring and drama programs, paid for buses to get kids to and from after-school programs and provided teacher training for paraprofessionals who might consider becoming teachers in the district.

For long-term expenses, including staffing and offering more social and emotional support programs, he is using the state-funded Student Investment Account.

“Schools are institutions just like a university. You can’t run a university with a whole lot one year and barely enough the other. They run best when there is stable, consistent funding,” he said.

Accountability for the millions

Jennifer Patterson, an assistant superintendent at the Education Department, said agency officials will continue to talk with school district superintendents about how to make the most of the money.

“We would want to be in conversation with districts to say, what are you noticing about this investment? Is it yielding outcomes that you can see? And to help people do what educators do best, which is to notice a need and be responsive to shifting their investment and strategy if they’re not seeing the kinds of outcomes that they predicted.”

The department itself gets to set aside 10 percent of all the relief dollars, or roughly $165 million, for emergencies, combating learning losses, helping charter schools, the Oregon School for the Deaf and juvenile corrections programs. 

So far the department $56 million to combat learning losses.

“The arc of the money is long and we’ve talked about going slow to go fast,” Patterson said. “In the sense of, you know, this money doesn’t have to be spent until September 30, 2024. So, really taking a longer view of the investment over time, that will maximize meeting the strengths and needs of local communities and students.”

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By Brian Johnson

91��Ƶ Newswire

Mortenson Construction is part of a major push ramping up this fall to promote diversity in construction, an initiative inspired in part by the national reckoning following the death of George Floyd in Minneapolis.

Mortenson is a founding member of the Time for Change consortium, which aims to advance “diversity, equity and inclusion” in the industry and ensure that job sites are free of “harassment, hate or bigotry of any kind.”

The consortium boasts some of the biggest names in the U.S. construction industry. Besides Mortenson, founding members are Gilbane Building Co.; Redwood, California-based DPR Construction; New York-based Turner Construction Co.; St. Louis-based McCarthy Building Cos.; and Bethesda, Maryland-based Clark Construction Group.

Time for Change plans to launch its “Construction Inclusion Week” this fall. As part of the event, scheduled for Oct. 18-22, the group encourages all contractors to organize diversity-related activities and explore topics such as unconscious bias and job site culture.

Also up for discussion are themes that include “leadership commitment and accountability for diversity, equity and inclusion; supplier diversity; and community outreach,” according to the consortium.

Dan Johnson, president and CEO of Mortenson, said the group was formed last year after construction executives from across the country gathered to discuss an effort to attract young people to careers in building-related fields.

A seminal moment came after the CEO of Turner Construction pulled Johnson aside and said there was another topic he wanted to discuss.

“It was shortly after George Floyd’s murder,” Johnson said. “And the topic was, ‘What are we going to do as an industry to improve? How do we take the momentum that’s currently being created in society and apply it to our industry?”

Like most industries, construction “needs to advance in the areas of diversity, equity and inclusion,” Johnson added. “But I think construction in particular has some unique challenges in that area. And so, from that, we formed an alliance called Time for Change.”

Time for Change isn’t alone in calling for more diversity and inclusion in construction.

The Associated General Contractors of America went down a similar path with the recent launch of its  program, which aims to ensure that “every employee, from the CEO to the laborer, has the opportunity to feel valued, respected and heard.”

From the field to the boardroom, there’s a lot of work to be done.

According to AGC, people who identify as Black make up 12 percent of the total workforce, but only 6 percent of the construction labor pool. Women compose 47 percent of the overall workforce, but just 9 percent of construction workers, according to the AGC.

Asked how much progress he’s seeing in the building industry on the diversity front, Johnson said it depends on where you’re looking.

“If you walked in our lunch room, you would say, ‘You guys are making really good progress,’” he said. “If you walked into a senior leadership meeting, you’d say, ‘You guys really need to get going.’

“But our senior leadership looks like the people we hired 20 and 30 years ago. So I think the dilemma for Mortenson and a lot of firms is: ‘How do we diversify our leadership while still respecting the people that are growing up inside our industry and inside our company?’

“That’s a challenge we all face.”

Each day of Construction Inclusion Week offers a theme related to specific challenges and opportunities.

In Mortenson’s case, the main topic is supplier diversity. The firm has made a concerted effort to work with a diverse group of suppliers, including women- and minority-owned firms, Johnson said.

That applies to all of its projects, not just on public work, he said. Johnson added that it’s not enough to just have diversity outreach plans for big projects like U.S. Bank Stadium in Minneapolis, which come with equity goals.

“You can’t have that (one large project) and then not do it again until the next public project, because you won’t create the capacity in the industry,” Johnson added. “And it’s just the wrong thing to do.

“We need to have diversity on every project to build that capacity to allow those firms to be sustainable.”

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By Nate Beck
91��Ƶ Newswires

A year and a half into the pandemic, contractors are contending once again with a shortage of skilled labor that’s compounding supply chain delays and project disruptions.

Before the pandemic, contractors broadly faced a lack of labor, although firms enjoyed a backlog of projects. Results of a survey from the Associated General Contractors of America released Thursday, however, show contractors are facing a labor shortage along with supply-chain disruptions, materials cost increases and other problems brought on by the pandemic.

“Market conditions are nowhere near as robust as they were prior to the onset of the pandemic,” said Ken Simonson, the association’s chief economist. “At the same time, the pandemic and political responses to it are limiting the size of the workforce, leading to labor shortages that are as severe as they were in 2019 when demand for construction was more robust.”

AGC surveyed 2,100 contractors nationally — including 76 in Oregon — to gauge the ongoing effects of COVID on the construction industry. Contractors in recent months have been hampered by delays in the delivery of materials and rapid increases in the cost of building materials.

In AGC’s latest survey, however, many firms reported an acute shortage of labor as well. The shortage of labor is one factor that’s causing nearly nine out of 10 contractors surveyed to say they’ve seen project delays in recent months, Simonson said.

About three-quarters of contractors surveyed nationally said they have increased pay to attract more workers, while about one-third of respondents said they had added hiring bonuses to attract more workers.

Nationally, 75 percent of contractors surveyed said a shortage of materials was leading to project delays. Meanwhile, 61 percent of firms said a shortage of labor had led to project delays.

Stephen Sandherr, AGC’s CEO, said the trade group is calling on Congress to pass an infrastructure package that would bring the construction industry more work. AGC is also advocating for more support for training skilled construction workers.

“The federal government currently spends only one dollar on career training for every six it puts into college prep, despite the fact only one-in-three jobs requires a college degree,” Sandherr said. “Boosting federal investments in career and technical education will help attract and prepare more people into high-paying careers in construction.”

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