America the Resilient: Navigating an Unusual Recovery

July 30, 2021 / By Kevin Norcross

Remember last year this time, when we were all working to navigate “business as unusual,” waiting for the pandemic’s end so we could get back to shaking hands with our business partners and holding face-to-face meetings? We may be seeing an end to the pandemic now, but we can’t quite say everything is back to the way it was. We’ve moved out of an emergency declaration as a nation to face new crises around labor and material shortages—not just in construction but across most industries.

Challenges are nothing new for the AEC industry. You stay in this business long enough and you face all types of unexpected situations. More importantly, you come to recognize that where we are today is the place to be: we’re on the other side of calamity, ready to rebuild.

Now is the time to focus on opportunity and how to take the lessons learned from the COVID-19 pandemic to build a more resilient future. After all, we’re watching the global economy return to pre-pandemic levels. We see design and construction demand setting records on a regular basis. It seems like AIA is tracking record high billings each month. The Dodge Data & Analytics Momentum Index tracked six months of massive gains at the start of this year, before dipping to the point that remains well above pre-pandemic demand.

To support all this new construction, manufacturing is picking up as well. The National Association of Manufacturers’ Outlook Survey for the second quarter of 2021 found that 90% of respondents felt either somewhat or very positive about their company outlook—predicting the highest levels of production, sales and job growth in Outlook Survey history. Compared to a reading of 34% one year ago, the worst such reading since the Great Recession, it’s an eye-opening picture of the wild ride that the last year has been.

We’re seeing all of these trends in play here at Vetrotech, where we’re facing backlogs at a level we’ve never seen. I see this as a direct result of the resilience of the U.S. economy and our manufacturing base. So, the question here becomes: how do we sustain this momentum going forward?

What is normal anyway?

Despite these positives, we all recognize that the pandemic has changed us, how we live and work. President Biden may have declared the pandemic over, but I think we’ll see in the fallout in how businesses operate for a long time to come. Our best bet for navigating this recovery is to keep a close eye on the data, and our partners, so we can all get through the bumps ahead. A few things to keep in mind as we attempt to forecast demand to respond to market needs:

• Demand won’t hit all regions the same. There’s demand for construction all over, but there are some regional variations to watch as well. Most notably, major metros—think New York, Houston and Los Angeles—aren’t the hotbeds of activity we’ve come to expect. People are moving to the suburbs and pushing up demand in places like Idaho and Vermont. It’s more important than ever to keep in contact with your regional trade associations and Chamber of Commerce to watch the trends in your area.
• We see design shifts due to COVID. Real estate developers are rethinking building layouts and internal space planning to respond to remote working changes. Institutions are rethinking the way people congregate and how buildings impact our safety. As designs evolve, it’s important to keep key partners in the know. Be upfront with information.
• We will see longer planning times. It takes time to respond to design shifts or spec alternative materials. Being proactive around scheduling will be critical. Bring vendor partners together as early as possible. The earlier we can get on a project, the better off we all are.

How you can support this recovery

Like I said, if you stay in this business long enough, you learn a thing or two about working through unexpected challenges. So, here’s my advice for navigating the year ahead and adjusting to new expectations:

• Take good care of your best people. Navigating material shortages is child’s play compared to the labor shortages manufacturing and construction are facing. This isn’t a new problem, but COVID has made it worse. We’ll have to work harder to keep our best people.

Our parent company, Saint-Gobain, was named “Top Employer Global” by the Top Employer Institute for the sixth consecutive year, one of only 16 organizations in the world to carry this distinction—so we know a little something about taking care of our people. We’ve found that the big key here is that you listen to concerns as they arise and continuously work to make improvements.

• Take care of your clients. We all depend upon our partners’ success to move our own business objectives forward. Your planning and backlog management will guide your clients’ and partners’ planning. It’s critical to have frequent touchpoints and honest discussions.

Our commercial marketing team strives toward this end by serving as part of the design team for key clients throughout North America. We work to supply building solutions to clients across many different business units from project start to finish. By partnering earlier in the design process, we can more rapidly respond to changes and help our clients move forward with confidence.

• Partner with stable companies. I’ve been getting questions consistently from customers about whether we are facing difficulty in getting materials. We’ve been fortunate that St. Gobain’s stability and global position have kept us from facing any shortages, including the reported PVB shortages some manufacturers have faced. Our size has allowed us to increase stock and put material on the floor in excess of our normal usage.

It’s not all luck. We saw this coming. Washington was ground zero for COVID, and so we started disinfecting surfaces at our Auburn, Wash., headquarters weeks before it became a CDC requirement. Similarly, we started increasing inventory mid-2020 as we began to plan for this recovery. When you watch the signs closely, you can better prepare. We’ve weathered enough downturns to recognize that this recovery would be coming fast.

I’m optimistic that by this time next year, we’ll be asking “what pandemic?” because we’ll all be so busy. We won’t know what to do with the demand. There’s always a greater opportunity on the backside. We just have to keep our heads above water a little bit longer. For now, keep your eyes on the indicators, often talk to your partners, and don’t be afraid to reinvent “normal.”