Contractors Group Offers Resources to Help Members Manage Skyrocketing Inflation
The Associated General Contractors of America didn’t wait for members to ask them for resources to help mitigate the effects of rapidly increasing inflation on their bottom line. AGC responded immediately with up-to-date information to help keep members in business.
Inflation continues to rise steeply, reaching the highest rates since 1981, according to a Bureau of Labor Statistics report [PDF] released this month. Knowing this, the Associated General Contractors of America is keeping its members apprised of how inflation is affecting them—but it isn’t stating the obvious.
“One of our core functions as a trade association on our members’ behalf is not just to educate them on what they already know—which is that materials prices are going through the roof—but to give them resources they can use,” said AGC’s Vice President of Public Affairs and Strategic Initiatives Brian Turmail. “They didn’t have to ask for it because it’s our job to know they need something like this.”
In response to more than two years of extraordinary increases in materials costs, supply chain holdups, and a competitive labor market, AGC began posting frequent Construction Inflation Alert updates in March 2021 to help project owners, government officials, and the public understand how these conditions are affecting contractors. The updates also help AGC members explain to their clients about the rising costs of materials because an estimate for a project six months ago is probably not going to be relevant now.
This isn’t the first time AGC developed updates on inflation. The initial ones started right after 9/11 when there was a comparable spike in materials prices. However, back then the group printed several thousand copies of the alerts and mailed them out. Now they are both delivered electronically and updated regularly.
AGC disseminates the alerts on a variety of channels, including to its chapters around the country, 30,000 people signed up for its economic updates, social media channels, and now-frequent webinars.
In-House and DIY Options
AGC has had an in-house economist since 9/11 to help explain macroeconomic trends and translate what that means for the industry, as well as a research analyst to crunch the numbers. “It’s a valuable resource in terms of being able to track and—more importantly—explain all these different economic data and put it in terms contractors will understand,” he said.
For associations that don’t have in-house economists, Turmail noted the federal government is a useful resource because nearly every department has an agency that tracks statistics. “There’s an enormous amount of data that’s available,” he said.
And while it is helpful to have an economist to explain the complex issues, “anyone who knows how to manipulate a spreadsheet and search the internet can pull down information and at least provide a summary of what’s available,” he said. Checking out public universities or other higher-education systems for economists who might be able to help provide some analysis and resources is another option.
Member response to the inflation resource has been positive. At AGC’s annual convention back in March, the group received lots of feedback about how valuable the construction inflation alerts are.
“Part of advocating for our members isn’t just working the halls of Congress and pushing back against federal regulations,” Turmail said. “In many cases, it’s simply educating the folks our members work for about what’s happening in the economic world and what that means for the cost of construction.”
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