ENR Southwest Top Specialty Contractors: Southwest Trades See Mixed Path Going Forward

Abstract

August 29, 2022 David M. Brown KEYWORDS A-1 Masonry / AGC / American Subcontractors Association / Arizona / Nevada / New Mexico / Rosendin Electric / Specialty Contractor / subcontractors Order Reprints No Comments Facing inflation, material shortages, skilled labor shortages, fuel escalation, bidding uncertainties and the onset of project labor agreements and a possible recession, subcontractors in the three-state region of Arizona, Nevada and New Mexico continue to fight on many fronts for pre-pandemic normalcy. "We're coming off fuel-escalation negotiations and entering full-scale materials shortages in things like steel, bridge supplies and finish materials. In addition, Buy America measures are in the long term good, but this is not a good time to implement them, so we support a waiver."Additionally, PLAs are challenging companies to remain competitive in quality while raising the price of public works projects 14% to 16%. "It couldn't be a worse time to introduce PLAs. It takes out the smaller prime contractors, mandates expensive compliance controls and increases the price of the projects to the consumers," he says. Because of inflation, continuing issues with labor and materials delays, Garcia notes, "It's going to be a bumpy road [ahead]."Crews with contractor AUI Inc. at work on a paving project in Anthony, N.M.Photo by Jonathan WassonComing Off a Good YearIn 2021, Arizona specialty contractors did "Quite well, all things considered. Arizona has continued to grow, and many of the skilled-trades companies in our membership have an impressive backlog of work built up," says Josh Umar, executive director of the American Subcontractors Association of Arizona, with 215 members, mostly in the Phoenix area. Many subcontractors are still seeing project delays that are "Not necessarily due to their own performance and maintaining schedules to deliver the work they are under contract for," he adds. Stephens notes the company's regional backlog "Is still at record levels and we have a number of very large, multiphase projects that started or will start this year."Particularly strong are data centers, energy and semiconductor-related projects. "I'm excited to see a strong resurgence of trade schools in general and the societal awareness that trades are excellent professions that provide opportunities for advancement, company ownership, if wanted, and a great income."She explains that labor remains a struggle but is encouraged by Nevada's adoption of the Apprenticeship Utilization Act, requiring public works projects to use a percentage of apprentices. "The ability to keep working, adapt and build momentum on projects has set our members, and the state, up for continued progress even if a slowdown happens," Umar says.