Building a New Normal
Top 50 Glaziers adapt to uncertainty during COVID-19
This year’s Top 50 Glaziers survey, which opened in mid-March, captured responses from an industry facing unprecedented challenge and uncertainty due to the COVID-19 pandemic. Results from the survey, collected over a month, show the cascading effects of the coronavirus on the glazing industry, including increasing concern for worker safety, cancelled and delayed projects and supply chain disruptions.
Despite the disruptions, and sometimes because of them, companies have adapted and innovated, blazing trails and moving forward into uncharted territory. “I don’t think we’ll ever go back to what was normal before,” says Nataline Lomedico, CEO and president, Giroux Glass, a Top 50 Glazier. “I think it will be a new type of normal.”
Building During COVID-19
I write this as I work from home, one of the many members of the workforce who is doing so as office spaces are closed, and stay-at-home orders are still in effect for most states as of late April. Construction field work, which cannot be done remotely, has proceeded with safety measures in place in states that deemed it an essential service, though some states, like New York, shut down all but the most essential construction work as the coronavirus continued to spread.
For those firms still operating, with reduced business or not, field work has posed new challenges. “We do daily cleaning of work stations, check people’s temperatures―using an infrared thermal unit―promote frequent cleansing and washing of the hands, social distancing, and we have our project management meetings outside,” says Ray Crawford, president of Crawford-Tracey Corp., a Top 50 Glazier.
Many companies reported difficulty acquiring PPE for workers to wear on the jobsite, which pushed glaziers to get creative. Giroux Glass leadership, for example, created its own face shields for field staff, says Lomedico.
Though some construction has persisted, many companies have faced jobsite closures. Data from the Associated General Contractors of America surveys in March and April paint a picture of rolling closures as the pandemic spread. The AGC survey, published April 3, compiling responses from March 30-April 2, recorded that 53 percent of contractors reported delayed projects, and seven percent cancelled projects.
Business closures have resulted in furloughs and layoffs across industries, and historic levels of unemployment. March data from the Bureau of Labor Statistics shows that total nonfarm payroll employment fell by 701,000 in March, and the unemployment rate rose to 4.4 percent, the largest over-the-month unemployment increase since 1975.
Nonresidential building construction lost 11,000 jobs in March.
While lack of cash flow and worksite closures put pressure on many businesses to furlough or lay off workers, Lomedico recommends keeping workers if at all possible. “You should be trying your best to keep your talent, because the work will return,” she says. “It takes a long time to find the right people, and to have to lose them because of a short-term situation would be devastating. I would recommend doing everything in your power to find different ways to use your team.”
Looking ahead to recovery, economists warn that the landscape has changed, and that construction recovery will take time. “I think the trend toward having less work is going to continue,” said Ken Simonson, chief economist for the Associated General Contractors, in an early April presentation. “I think that even if businesses start to reopen, if the extreme orders to stay at home are lifted, just getting businesses up and running again will be [owners’] priority. And so many businesses are not going to have either the immediate cash, or the expectation that they will need a project that they have been contemplating.”
Forecast data from Dodge Data & Analytics suggests that commercial construction starts will drop by 16 percent in 2020. “We are in recession, full-stop, no question about it,” says Richard Branch, chief economist for the organization. Branch projects a “short U” shape recession, meaning a more gradual recovery, rather than a quick rebound.
Branch says that not every market segment will rebound in the same way, or on the same timeline. He predicts that retail and hospitality will be the hardest-hit sectors, with projected 2020 declines of 33 percent and 31 percent respectively. Meanwhile, health care will be the strongest sector to recover. Branch forecasts a 5 percent rise in 2020. K-12 building will continue to ease, as will college and university building, the latter due to current financial strain, he says.
Beyond the Pandemic
It may be hard for companies to plan for the future when it is difficult to predict labor and market realities a week, let alone a month, in advance. However, some in the industry feel that the current situation is an opportunity for glaziers to pause, plan and prepare. Here are a few potential ways that business could change after COVID-19.
The COVID-19 crisis has highlighted the potential use of prefabricated materials and modular building. Sixty-four percent of Top 50 Glaziers report fabricating curtain wall in-house. “Prefab could be a trend going forward―it’s a no-brainer with regards [to] the efficiency, and the quality control,” says Crawford. Dodge Data’s Commercial Construction Index for Q1 2020 reports that the top sector for the use of prefabricated materials is health care, which, given the likely stability of the health care market segment, may further push adoption of prefabrication.
Given the likelihood that the profitability of some industries will change temporarily, and possibly permanently, Lomedico says that the company is reconsidering what kinds of market segments to seek work in. “Some diversity is needed, because we won’t know the impact of how it will trickle down to us through the different industries we work in,” she says. “We’re taking a better look at the owners of the projects in our backlogs, and asking, ‘Will they still have the funding? What is their financial strength? What else are they investing in?’”
Another result of the pandemic may also be increased use of technology and software, both on and off the jobsite. Many companies, across industries, have had to set up remote work situations, some for the first time and in short order.
“This could change [the use of] technology; the face-to-face and social aspect of [work] might lessen, and many of our people are now learning how to work from home,” says Crawford. Crawford-Tracey already had a remote desktop set up for workers before the COVID-19 pandemic, a system that allows employees to access files from their office workstations at home.
Lomedico also feels that this marks a turning point in the adoption of technology. “We are all becoming accustomed to ever-changing information, and when this is over, we’ll be used to that,” she says. She characterizes this as an opportunity for glaziers to get the kind of systems that will work for them. “Software companies, on the development side, are working at a rapid pace to customize what we need. We’re all going to reap the benefits of that,” she says.
Jeff Sample, director of strategic accounts at eSub, a construction software firm, also says this could be a “Big Bang” moment for glazing firms to digitize. “I think we won’t go back to business as usual across the board,” he says. “I think it will fundamentally be the digitization moment, the adoption in usage of technology and remote work ... We’ve just not had a reason to change the way we do things. And I feel like now we have one. And it’s on us now, as an industry, if we don’t embrace it.”
Industry ranking and market report
The following report includes a ranking of the Top 50 glazing firms serving the North American market, organized by 2019 gross sales information.
The report also includes in-depth market analysis of the state of the U.S. glazing market, based on statistics supplied by reporting companies. The report presents sales and growth information, an early look at how COVID-19 might affect construction in 2020 and beyond, as well as product and technology trends.
Projects from the Top 50 Glaziers