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How is the Coronavirus Crisis Affecting the Construction Industry?

Construction, by and large, is a huge part of the world’s economy

Ever since the World Health Organization declared Coronavirus a global pandemic, countries have been scrambling for their next steps.

Countries across Europe have effectively shut down, the United States has closed its borders, and India’s Prime Minister Narendra Modi recently ordered a 21-day countrywide shutdown.

The world economy has become a big focus as many businesses either shut their doors voluntarily or are closed as they do not classify as a “non-essential” service. 

Some sectors, like hotels, airlines, and other travel-related industries have taken a beating. Numerous airlines such as American Airlines, Lufthansa, Delta, and British Airways are requesting government assistance in order to survive the overnight loss of flights and passengers.

Other industries, such as online entertainment, grocery stores, and eCommerce are thriving. 

Then, there are industries that seem to be stuck in the middle. Construction is one of those industries as different countries seem to have different responses to what to do with construction.

So what is in store for the construction industry?

Workers Fear for Their Safety

With nearly all countries preaching the importance of social distancing, construction is one such industry that is unable to put social distancing practices into play. With so much collaboration on the construction site, both in close contact and through the exchange of tools, it’s easy to see why construction workers might feel a bit frightened.

It’s not just the fact that workers might be in close proximity to one another at the worksite, but they are also in close proximity with hundreds if not thousands of strangers during their commute. 

coronavirus
It’s not just the fact that workers might be in close proximity to one another at the worksite, but they are also in close proximity with hundreds if not thousands of strangers during their commute.

Many countries have already classified construction workers as non-essential, but others have been a bit vague. The UK, for example, has said that if work can continue in the open air, then it should be allowed.

Projects Delayed

Many countries receive their construction materials from other countries through trade. India is one such country as the second-largest country in the world receives much of its materials from China. 

The main goods received are iron, steel, electronic equipment, plastic goods, and more. When those shipments stopped to do the virus spreading, many firms had but no choice to delay projects. 

This is a phenomenon that is also worldwide, as the United States reports that around 30% of construction projects have been put on hold with contractors saying that almost 20% of the delays were due to equipment issues or lack of products.

Projects that are continuing are making use of all tools available, getting creative with how materials are moved and consistently working towards a quick solution.

A Huge Part of the Economy

Construction, by and large, is a huge part of the world’s economy. In India, construction is responsible for roughly 15% of the working class and over 5% of the country’s GDP. 

In fact, the construction market is expected to be worth $1 trillion within the next five years, according to a report from KPMG in 2016. 

With such a large part of the economy coming to a semi-halt, how is that going to affect the nation’s economy overall?

Construction
Construction, by and large, is a huge part of the world’s economy. In India, construction is responsible for roughly 15% of the working class and over 5% of the country’s GDP.

As of now, it means that a lot of people are losing their jobs. With over 30 million people employed in the construction industry, that’s a lot of the working class that’s being told to stay at home.

The majority of India’s construction workforce are contractors, meaning they do not have the same protections and rights as employees would. Many are expecting to lose their jobs over the next few weeks.

The government is expected to unveil a multi-billion dollar stimulus package in the next coming days which will help, but many will still continue to feel the effects of the lockdown and lack of work.

A Boom in the Future?

What happens when this is all over and people start returning to work?

Unfortunately, no one knows the correct answer to that question. The world is still in the early days of the global pandemic and with many countries instituting lockdowns recently, it would be unwise to try and predict the future.

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Projects would likely start to trickle back in slowly as measures are taken to make sure there isn’t a second wave of the virus. The fight for jobs will be fierce as the market is likely to be flooded with millions looking to work again.

Eventually, though, people will start spending money again which should help the economy start to recover.

[Disclaimer: The pictures used in the article are supplied by the author, NewsGram has no intention of infringing copyrights.]

 

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