It has been over a year since our nation experienced our first bout of “essential” business. As a General Contractor and Design-Builder headquartered in the state of Iowa, our crews at Dean Snyder Construction (DSC) have been grateful for the opportunities to continue to work, not only in our home state, but across the country as well. As we adapted to a new normal of jobsite safety, other unexpected concerns arose. The costs of lumber and other crucial building materials became troubling as demand for new construction developed, particularly in residential in 2020. This is not something one would normally expect as the unemployment rate grew to levels we hadn’t seen since the Great Depression, yet the record revenues of Home Depot, Lowes and Menards told a different story.
As of August of 2020, the cost of lumber had risen 30%. Today, we are seeing lumber increases upwards of 400% higher than it was pre-pandemic levels. Demand has risen with low interest rates and from those working from home, having more time for home office or remodel projects. Combine this with financial incentives and added stimulus dollars, the demand for new construction climbed sharply. Meanwhile, supplies lagged, largely due to pandemic mill closures.
But also, the price increases and volatility haven’t stop here. We are seeing delivery delays continue across the board when it comes to building materials. Not only are these matters a result of the pandemic, but the shortage of truckers, stranded cargo off the coast of California, backup issues related to the Suez Canal, unusual weather (from Midwest derechos to extraordinary freezing temperatures in Texas) have also caused several plant closures, in turn causing further supply/demand issues. One such issue is a nationwide shortage of resin, which is a product used to manufacture building products such as OSB, vinyl siding and vinyl windows.
Despite these unprecedented issues, at DSC we are continuing to hire new employees, anywhere from green laborers to seasoned superintendents. We believe having an intentional training program will be the key to sustainable growth as the skilled labor shortage has not left our industry. In fact, it has been more difficult to hire as stimulus and unemployment benefits prove to be more enticing than the 9 to 5. We hope to see these skilled labor issues ease up towards the end of summer when these benefits come to a halt.
With the current volatility in our industry, we are encouraged and hopeful by having clients in the food ingredient, food processing/manufacturing, industrial manufacturing and pharmaceutical industries. Experience in cold storage warehousing, RTE facilities, R&D lab/clean rooms, millwright, plant relocation & processing room expansion will be of significant value to our current and prospective clients in the months ahead. Dean Snyder Construction’s unique experience and capabilities are beneficial to those companies that need the resources to continue output of necessary and vital products relating to human and animal nutrition.
We are grateful to serve the “essential” markets and be the “essential” providers as we continue to build our great America.