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Covid’s Impact on Construction

In this study, we will take a look at key indicators to understand the performance of the construction industry amidst the 2020 pandemic.

This fascinating report showcases the short negative impact in March 2020 but the explosion in construction demand thereafter, long into 2021 and still growing while you read this today.

Total value of construction a month

  • As the charts and tables below suggest, the total  value of constructions put in place recovered  steadily from the 2008 financial crisis, with a few  notable decline, including the Q2 of 2020.
  • By the start of 2020, total monthly construction  value amounted to $1,459.4 billion a month,  growing from $1,348.7 billion a month from  January 2018. The lowest value in 2018 to November 2020 is November 2018, with a Total construction value of $1,287.8 billion a month.
  • By the end of November 2020, total construction  value grew back up to $1,459.44 billion a month,  the highest value the indicator ever reached for the  sector.
Construction Value
Total Construction Value

Date

Total Construction in Millions of Dollars

Nov-20
1,459,440
Oct-20
1,446,877
Sep-20
1,423,963
Aug-20
1,426,884
Jul-20
1,398,952
Jun-20
1,383,647
May-20
1,369,363
Apr-20
1,387,936
Mar-20
1,436,727
Feb-20
1,441,145
Jan-20
1,437,719
Dec-19
1,410,267
Nov-19
1,405,510
Oct-19
1,386,826
Sep-19
1,393,304
Aug-19
1,378,956
Jul-19
1,366,042
Jun-19
1,354,080

Date

Total Construction in Millions of Dollars

May-19
1,352,895
Apr-19
1,356,014
Mar-19
1,337,504
Feb-19
1,324,229
Jan-19
1,314,616
Dec-18
1,289,604
Nov-18
1,287,767
Oct-18
1,301,777
Sep-18
1,316,355
Aug-18
1,332,656
Jul-18
1,333,714
Jun-18
1,341,076
May-18
1,362,246
Apr-18
1,362,805
Mar-18
1,358,387
Feb-18
1,373,812
Jan-18
1,348,653
Construction Gross Output

Total value of construction a month

Gross output is the revenue of an industry. It is calculated as the value of sales minus the value of goods used to produce those sales.

How did the Construction Sector Perform BEFORE the Pandemic?

The gross output of the construction sector steadily grew in terms of Gross Output, peaking at $1775.9 billion a month in first quarter of 2020, the highest value the indicator ever reached for the construction sector.

Construction Sector Before the Pandemic

How did the Construction Sector Perform BEFORE the Pandemic?

  • The growth of every industry either slowed down • The growth of every industry either slowed down  or took a dip during the second quarter of 2020.
  • The Real Gross Output of all industries combined  declined by 29.5%, equating to $2.86 trillion of  losses in terms of revenue.
  • Out of 20 sectors, only the Finance and Insurance  sectors grew with a positive rate during Q2 of  2020.

How did the pandemic affect the revenue of the construction sector?

Construction Pandemic Affect on Revenue
  • During Q1 of 2020, the Gross Output of the Construction sector increased by 11.4%, reaching $775.9 billion.
  • During Q1 of 2020, the Gross Output of the Construction sector increased by 11.4%, reaching $775.9 billion.
  • During Q2 of 2020, the Gross Output of the Construction sector took -13.7% dip, equating to $51.3 billion of losses in terms of revenue.
  • During Q3 of 2020, the Gross Output of the Construction sector increased back up to $1751.1 billion.
  • Although $51.3 billion worth of losses is bad news for the sector, the Construction sector was not hit as hard as other sectors. Out of 20 sectors classified by NAICs, the Construction sector was not hit as hard as 13 other sectors.

Construction Gross Output in Billions of Dollars

2018 Q1Q2Q3Q4
16211658.81659.61633
2019 Q1Q2Q3Q4
1667.416781695.81718.7
2020 Q1Q2Q3
1775.91709.91751.1
Construction Sector Comparison

How did the construction sector compare to other industries?

  • In terms of percentage change, the construction  sector increased the largest during Q1 of 2020.
  • In terms of percentage change, out of 20 sectors  classified by NAICs, the construction sector did  better than 14 other sectors and did worse than  5 others during Q2 of 2020.

Sector

Q1 Percent
Change from
Previous Period

Construction
11.4
Agriculture, forestry, fishing, and hunting
9.2
Real estate and rental and leasing
2.3
Utilities
1.2
Government
-0.8
Finance and Insurance
-1.3
Professional, scientific, and technical services
-1.5
Wholesale trade
-1.9
Mining
-2.1
Management of companies and enterprises
-2.9
Information
-3.3
Manufacturing
-4.0
Administrative and waste management services
-4.5
Educational services
-4.9
Health care and social assistance
-5.5
Retail trade
-8.1
Transportation and warehousing
-12.6
Other services, except government
-17.7
Arts, entertainment, and recreation
-34.6
Accommodation and food services
-35.4
Construction
Construction Sector

Sector

Q1 Percent
Change from
Previous Period

Accommodation and food services
293.5
Arts, entertainment, and recreation
215.0
Transportation and warehousing
64.6
Other services, except government
61.9
Wholesale trade
55.0
Health care and social assistance
49.7
Manufacturing
49.4
Retail trade
45.1
Administrative and waste management services
31.3
Professional, scientific, and technical services
21.8
Educational services
20.2
Information
17.3
Agriculture, forestry, fishing, and hunting
15.9
Real estate and rental and leasing
11.0
Finance and insurance
6.5
Construction
4.4
Management of companies and enterprises
3.2
Government
2.0
Utilities
-0.6
Mining
-12.2

Sector

Q2 Percent
Change from
Previous Period

Finance and insurance
3.8
Utilities
-2
Management of companies and enterprises
-7.2
Government
-7.6
Information
-8.5
Construction
-13.7
Real estate and rental and leasing
-13.8
Agriculture, forestry, fishing, and hunting
-14.3
Retail trade
-18.2
Manufacturing
-32.8
Professional, scientific, and technical services
-33.4
Educational services
-36.1
Administrative and waste management services
-37.8
Wholesale trade
-39
Health care and social assistance
-42.1
Mining
-55.2
Other services, except government
-63.1
Transportation and warehousing
-64.9
Accommodation and food services
-84.3
Arts, entertainment, and recreation
-95.6
Construction Industry

Construction Sector and Employment

Construction Employment
  • In terms of employment, the construction • In terms of employment, the construction  industry was in a path of constant growth,  peaking in a total of 7.6 million workers in  February 2020.
  • The total number of workers dropped to 6.6.  million by April 2020, but is steadily recovering.
  • Partial November 2020 suggests that the  construction sector recovered back to 6.4  million workers.
Construction Sector and Employment
YearJanFebMarAprMayJun
2010558055005537555355205516
2011542754515477548555165528
2012562656295625561856045621
2013574657845802579658295855
2014598560076038608461096133
2015632063616334639264276441
JulAugSepOctNovDec
550855245501550855065467
554755525584558855935611
563256485661566156845724
585958785910591059635932
617862106242625962726293
647264906508654765986630

Takeaway

Q1 2020

Indicators including Gross Output and Total Construction Value Put in Place suggest that the construction sector was doing great before Q2 of 2020 when every other sector declined.

$5,703,527 billion

construction value put in place

$1775.9 billion

gross output a month

7,639,000

peaked number of workers in February

7,639,000

Was the sector with the highest percentage increase in Gross output

Q2 2020

Just like every other sector, the construction sector had a rough second quarter, with the following statistics:

$5,578,846

construction value put in place. There was a decline in this particular indicator, but the value is still higher compared to other time periods from other years.

$1709.9 billion

Gross output a month, the lowest since Q4 of 2019

6,566,000

workers in April (end of first quarter), the lowest number of workers since 2016

6 out of 20

sectors in terms of percentage change in revenue. However, the sector still had a negative percentage change (-13.7%). Only the Finance and Insurance sector had a positive percentage change.

Q2 2020

The construction sector saw recovery during the third quarter:

6 out of 20

sectors in terms of percentage change in revenue. The sector had a positive percentage change (4.4%)

$1751.1 billion

Gross output a month

6,556,000

peaked number of workers in August based on partial data