The U.S. Chamber of Commerce Commercial Construction Index (CCI) dropped one point during the quarter to 65 due to several ongoing struggles for the construction industry, including rising costs, the skilled labor shortage, and supply shortages. Contractors’ revenue expectations, a key driver of the overall index score, fell for the first time since the beginning of the pandemic.
According to the CCI, contractors’ revenue expectations and new business confidence decreased from the third quarter to the fourth quarter, while the average current backlog increased over the quarter.
“One of the most pressing issues facing our economy today is the worsening worker shortage crisis, and these findings show that the construction sector, much like other industries, continues to face this challenge,” says U.S. Chamber of Commerce executive vice president and chief policy officer Neil Bradley.
Nine in ten contractors reported moderate to high levels of difficulty finding skilled labor, with 62% reporting high levels of difficulty specifically. The percentage of contractors experiencing high levels of difficulty finding workers is up 20 points from a year ago. As a result, nearly half of contractors reported turning down work because they can’t find enough skilled labor.
The U.S. Chamber of Commerce found a record-high percentage (95%) of contractors were experiencing at least one product shortage, up 24 points on a year-over-year basis. Steel, roofing material, and wood/lumber are top materials contractors report having trouble sourcing. According to the CCI, 97% of contractors indicated cost fluctuations have a moderate to high impact on their business, up 23 points year over year.
The CCI is a quarterly economic index designed to gauge the outlook for, and resulting confidence in, the commercial construction industry.
