COVID-19 and the Future of the Finishing Trades
In 2019, at the Finishing Industries Forum (FIF), Finishing First presented an industry study by FMI, the leading research and consulting firm in engineering and construction, on the Finishing Trades looking forward ten years. This six-month study covered economic, political, social and technological factors that would dictate trends in construction for the Finishing Trades over the course of the next decade.
Then COVID-19 happened…
In December, 2020, Finishing First hosted a webinar featuring FMI presenting updated research from 2019 and the COVID-19 factor.
The webinar, given by Mike Clancy, Principal of FMI, confirmed the data collected in 2019 that predicted that every single market would decline in 2020 was accurate. “We opened up last time (FIF) with an expectation that a recession was sort of around the corner, that an industry downturn would soon be coming in the first or second quarter of 2020, and I have never been so disappointed to be right as I was at that time,” said Clancy to the webinar attendees.
He reported that the mixed signals indicating this slowdown included a rise in personal consumption with a decline in consumer confidence which presaged recession. Residential housing and the manufacturing index were also slipping which gave a further indication that a recession was in the near future. Additionally, commercial, transportation and improvements were on the downfall – all of which play a huge demand for construction. Even with this, there was the addition of a global pandemic which shut down most of consumer activity, and for the first time ever, the economy dropped. “The economy has never shut off like a faucet before and that was widely disruptive,” Clancy said. With the help of the first round of stimulus checks and keeping the economy away from negative interest rates, the third quarter of 2020 showed the improvements market was on the rise.
As we look toward the future in the post COVID world, economic, technological and workforce trends were highlighted during the seminar as huge industry factors going into the next decade. Economic impacts include the needs for the investment in infrastructure. Technological impacts include rapid technology changes and the digitalization of workflow. Workforce impacts focused on the shortage of skilled workers and the decline in union membership.
New trends emerged such as the return of manufacturing and virtual professions. An added trend is the deletion of the necessary “college experience” as more young people see the benefit of starting a career in trades that gives them a middle-class lifestyle, great health benefits and ultimately allows them to be free of costly tuition.
In the economic headwinds the record number of corporate bankruptcies in the U.S. put a huge impact on our economy, however, recovery is promising. Namely, construction apprenticeships are now much more attractive especially to those who were working in retail or restaurants. In fact, FMI reports this is the best time in 50 years for trades recruiting.
Finishing First will continue to feature new research for the construction industry on a regular basis throughout 2021 as the industry begins to recover from COVID 19 and the men and women of the IUPAT get back to work. Visit www.FinishingFirstLMCI.com under Case Studies and Research to see the presentation.