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nexsenpruet.com 2 — JAN/FEB 2020 — The North Carolina Construction News
Mark Buckshon, publisher
By Mark Buckshon
As I write this, my wife and I are about to em-
bark on a two-month vacation to the South Pacific,
New Zealand and Australia. It is the longest journey
of my life (both time-wise and in distance) since
youthful adventures in Africa.

I suppose, if you are taking a long vacation, it is
good that everything is mostly in order at home.

Certainly, the construction economy, especially in
the Triangle and Triad, is healthy – to the point that
the major problem is a shortage of qualified skilled
labor. In my opinion, the biggest challenge for contrac-
tors and design professionals is complacency – the
good times will not last forever, and while they con-
tinue, these are ideal opportunities to bolster your
strengths and build your reserves.

There are ideas in these pages about the advan-
tages of diversity and inclusion, understanding the
rules regarding verified claims, and integrating
processes and systems to enhance your business’s
efficiency and profitability.

We can’t anticipate everything. When we started
planning this vacation almost two years ago, I had
no idea that we would need to consider the need
for industrial-strength face masks when visiting
Sydney or Melbourne, Australia. We can keep our
eyes open and ears alert and appreciate and adapt
to our environment (and maybe take some effec-
tive measures to protect it.)
I continue to believe one of the best ways to re-
main connected with the industry and to improve
your knowledge (while building relationships and
discovering business opportunities) is to join and
participate in relevant industry associations. These
could include (for marketing and business develop-
ment professionals) the Society for Marketing Pro-
fessional Services (SMPS), with local chapters in
the Triangle and Charlotte. Of course there are rel-
evant specialty trade associations, broader groups
such as the Carolinas Associated General Contrac-
tors (CAGC), and even groups that advocate for po-
litical/economic values, such as the Associated
Builders and Contractors (ABC) of the Carolinas, or
(if you are on the other side of the fence) trade
unions and relevant associations representing
unionized contractors.

While I’ll be travelling great distances in the next
several weeks, I will remain in touch and your
emails should reach me at buckshon@ncconstruc-
tionnews.com. Please write if you have comments
about this issue and suggestions for the next one,
which I will need to oversee from the other side of
the world.




2020 Construction Outlook:
CAGC’s perspective
While racking up thousands of miles driving through-
out the Carolinas, it’s amazing how much construction
work is going on these days with building, highway-
heavy and utility work. Construction workers and often
clogged highways are everywhere, from Charleston to
Greenville and Asheville to Wilmington, at a time when
one of our biggest challenges is attracting more people
into our excellent construction industry.

The U.S. economy appears to be slowing. The
naysayers are out there, but output and employment
should continue to grow in 2020. Construction is likely
to remain on an upward path, in North and South Car-
olina as well as nationally.

As Ken Simonson, Chief Economist for AGC of Amer-
ica notes, real GDP—inflation-adjusted gross domestic
product, the broadest measure of economic activity—
slowed in North Carolina from a 3.3% annual growth
rate in the first quarter of 2019 to 1.6% in the second
quarter. Similarly, real GDP growth in South Carolina
slowed from 3.5% to 1.8%. This tracks the slowdown
nationally. Most economists expect U.S. economic
growth to be as slow or slower in 2020.

However, one of the bright spots for the economy is
likely to be housing, now that mortgage interest rates
have dipped to a level that enables many more people
to qualify for a first mortgage, refinance or move to an-
other home without giving up a favorable rate. North
Carolina is well-positioned to benefit from an upturn in
housing. The state’s population has been growing at a
rate of more than 1% a year, while U.S. population
growth has slowed. Land and building costs are both
lower than the national average, making new homes
more affordable in the Carolinas than in other states.

Commercial and industrial construction will also ben-
efit from population and housing growth. In addition,
the state is poised to serve as a hub for transportation
and distribution-related construction. Highway and
other infrastructure construction should also contribute
to the industry’s growth in 2020.

Much appreciation is in order to the N.C. General As-
sembly as lawmakers, before adjourning their long ses-
sion recently, helped pump badly needed funding into
our transportation and highway-heavy construction
needs. South Carolina lawmakers also are to be com-
mended for increasing infrastructure funding.

In the Carolinas, as in much of the U.S., contractors’
top concern is finding enough workers – not work and
© Can Stock Photo / zerbor
By Dave Simpson
President, Carolinas Associated General Contractors (CAGC)
projects to bid on. In an annual survey of construction
firms conducted by AGC of America that was released
on August 27, 91% of the nearly 2,000 respondents said
they expect to hire hourly craft workers in the coming
year, and 70% of the firms plan to hire salaried employ-
ees—mostly for expansion, not merely replacement.

Among the 33 firms that listed North Carolina as their
principal state of operations, even higher shares said
they plan to hire for replacement or expansion—97%
want craft personnel and 77% seek salaried workers.

At the same time, 91% of the North Carolina contrac-
tors said they are having a tough time filling craft posi-
tions and 73% said the same about salaried jobs. That
may explain why construction employment in the state
has slipped a bit in 2019, following eight years of rapid
growth: there just aren’t enough qualified workers to
make up for retirements, let alone expansion.

In short, the outlook for construction in the Carolinas
remains positive but with the ever-present challenge of
finding, training and retaining enough qualified workers.

Please visit our CAGC Build Your Career website to find
how you can help become a BYC ambassador and re-
cruit fine folks for a great industry.

Dave Simpson is president of
the Carolinas Associated General
Contractors (CAGC). This story
was originally published in
the CAGC Newsroom.

The North Carolina Construction News — JAN/FEB 2020 — 3