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Chairman's Message: Impacts of COVID-19

We are six months into the COVID-19 pandemic. Despite our best efforts, the virus continues to spread and has created immense short- and long-term challenges for the construction industry. While construction has mostly been deemed essential, the pandemic has created a global economic downturn resulting in less demand for new construction in many market segments including commercial, retail, office, and industrial projects. Economic uncertainty has caused some owners to halt projects underway or cancel future projects.

Plant shutdowns due to stay-at-home orders have resulted in supply chain disruptions, especially for imported materials, which are increasing lead times for contractors resulting in project delays. Additionally, the surge in demand for personal protective equipment (PPE) has resulted in shortages of PPE for construction workers.

While workforce safety has always been a top priority in the construction industry, COVID-19 has presented a new and unprecedented threat to both field and office personnel. The Occupational Safety and Health Administration (OSHA), Centers for Disease Control and Prevention (CDC), U.S. Department of Health and Human Services (HHS), and state and local agencies have all issued guidance and regulations in response to the pandemic.

Most employers have implemented work-from-home programs for the safety of office staff. Field personnel may experience various changes to jobsites including symptom and temperature checks, social distancing, handwashing and sanitizing stations, and additional PPE, including face masks.

New federal legislation in response to the pandemic are also impacting employers. The Families First Coronavirus Response Act (FFCRA) contains several provisions imposing paid sick leave and expanded Family and Medical Leave Act (FMLA) leave on employers through December 31, 2020.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) has provided in excess of $2 trillion in stimulus funding through various provisions. One of the most popular provisions of the CARES Act is the Paycheck Protection Program (PPP), which provided forgivable loans to employers for eligible payroll and other costs.

For more information on these topics and more, be sure to check out CFMA’s COVID-19 Resource Center in the Connection Café (cafe.cfma.org/covid-19-resources).

To face these challenges, the construction industry must embrace technology. I may sound like a broken record (see the July/August 2020 issue of CFMA Building Profits), but once again, technology is a solution.

Additionally, the industry needs to reevaluate processes to provide safer jobsites. Consider using more off-site construction and prefabrication, and use multiple suppliers when possible to help rebalance supply chains.

As this issue of CFMA Building Profits focuses on risk management, we hope that the information contained herein will help CFMA members find ways to minimize the impacts of COVID-19 and manage other risks to their operations. 

Copyright © 2020 by the Construction Financial Management Association (CFMA). All rights reserved. This article first appeared in September/October 2020 CFMA Building Profits magazine.

About the Author

Kevin Booth

As our Chief Financial Officer, Kevin Booth guides our organization’s controllers and division managers through weekly and monthly meetings; coordinates monthly fiscal audit reports, and handles all insurance matters and banking relations.

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