2021 Impact Of Material Shortages
A major imbalance of supply has cost construction firms to work through challenges considering their financial performance and growth. The fear of scarcity has affected many individuals who work for the construction industry. Most workers can agree that 2021 has been a very problematic year. It has been loaded with repetitive disruption in manufacturing materials and supply. With material prices rising, builders are being expected to find their own materials and solutions.
The Coronavirus has been a leading reason for how this has affected the industry, and many are still barely recovering from the effects that the pandemic has brought. Many builders have been experiencing shortages in materials needed such as lumber, steel, glass and other materials. This has threatened business performance, which has not happened since the 1990’s.
There are many reasons for the consequences in raw material shortage that have been caused by high lead time, high production cost, wasted time, materials etc. There are many other materials that saw a high rise in shortages over this past year such as Framing lumber, Vinyl siding, Trusses, Gypsum wall board, Plywood, Roofing materials, Steel, Insulation and more. These materials are only some of the few that have caused more stress in being able to attain. This impact of material shortages is not just impacting some cities, but impacting many builders across the board.
There has been a significant price increase in key materials such as steel, pipes, and drywall. Because of these shortages, materials have been delayed throughout the industry. Prices dropped for lumber for a couple of months but then raised again by 40% since the middle of 2021.
Shutdown of factories and facilities for processing materials were forced closed due to the COVID-19 pandemic. This shutdown increased the effects on material and supply shortage, and this built more pressure on the need for material availability. This pressure for more materials also came from homebuyers. The U.S has been experiencing a major and painful shortage of housing. There are low interest rates while high prices for lumber. There is an immediate need for space upgrade since most people have contributed to working at home. This is also due to how quickly houses are being sold after being put in the market. This has been a very historic year for the housing market.
With a shortage in supply and with high demand, many houses are becoming unavailable quicker than ever. It is difficult to not point fingers towards COVID-19 for all the many unfortunate changes that have occurred.
The real estate market and supply are not the only things that are in a shortage crisis right now. According to the U.S Chamber of Commerce’s recent report, there are almost 90% construction contractors that are reporting having experienced severe difficulty in being able to find skilled workers to manage the work provided. This worker shortage has also added to the entirety of the problem. It has been more difficult to find individuals who are able to complete the projects in the correct manner, which has led to many contractors having to cancel at least 35% of projects planned.
There have been many changes in the construction industry due to the pandemic. It is important to consider how many people are still facing challenges due to a pandemic that has affected each and every individual in the world. This has negatively impacted industry players. These shortage problems do not seem to be getting better any time soon so it is important to view an upside to all of the concerns. All shortages and anything related to these shortages of workers and materials have caused construction companies and those who desire new homes to view alternatives to how they would like to proceed with their construction. Contact us today!