2023-2024 Minnesota Construction Industry Assessment Released

The 2023-24 AGC of Minnesota Construction Industry Assessment is being released today. This comprehensive survey provides a unique snapshot of the projected 2024 Minnesota construction market and a reflection of construction business challenges, and other influences that impact our state’s construction economy. There are many survey tools soliciting your input from across the industry, but only the AGC Industry Assessment covers the entire architect, engineer and construction (AEC) spectrum and focuses exclusively on the issues that matter to your construction business. Some brief highlights follow:

2024 Market Observations:

Overall, the outlook for 2024 construction services is slightly more positive than last year with engineering services reflecting the greatest positive outlook projection. Construction services demand is likely to remain strong into next year, yet headwinds generated by high inflation, tight skilled labor availability, and increased labor costs present the highest negative indicators impacting market optimism.

Labor Market & Hiring Outlook:

A tight labor supply continues to be a strong drag on the industry’s overall performance as the unrelenting demand for workers persists. The hiring outlook for 2024 mirrors the 2023 response as over 60% of respondents report plans to conduct significant or some hiring in 2024.

Diversity in Workforce and Subcontracting:

Developing a diverse workforce remains challenging in both field and office employment but signs of improvement are seen in yearly comparative data. Utilizing deliberate approaches to source diverse talent is unquestionably the most helpful strategy to increase diversity and more respondents (54%) are reporting their effort is making a positive difference.

The AGC Construction Industry Assessment provides a deep dive that explores many more aspects of Minnesota’s construction economy. I encourage you to spend time examining the responses as you are sure to find information that both affirms expectations and challenges assumptions. 

Thank you to all who participated in this year’s survey. The entire report can be accessed here. Past surveys are archived on the AGC website and can be found here. We remain Your Trusted Resource.

Tim Worke

CEO

Earned Safe & Sick Time Update

The new Minnesota ESST statute takes effect January 1. Here’s the latest to know:

• Coverage. The statute covers all employees except for employees who are members of the Operating Engineers, Carpenters, Laborers, Bricklayers, Iron Workers, or Cement Masons unions.

• Compliance. Complying with the statute requires several steps: deciding whether to front load or accrue leave (see below), creating or ensuring that your leave policy meets the statutory criteria for covered employees, updating your handbook or policies to reflect the change (see below). Many payroll companies provide easy mechanisms to account for and print accrued leave hours on the paystub. 
• Coastal Payroll provided a demonstration of one system at a recent AGC webinar that can be viewed here. 
• Also, DLI has posted a model notice (poster) here.

• Front load vs Accrue. The statute permits two ways to comply, front loading or accruing during the year. To decide which option is best for your business, AGC member law firm, Bassford Remele has provided a chart that will help analyze and strategize this decision.
• Bassford Front Load vs Accrual Chart

• Update policies. Each company should update its employment policies to reflect how it will comply with the ESST statute and/or union waiver. For instance, it should explain the process to request leave. Unfortunately, there is not cookie-cutter language to provide but each company should review its handbook and policies to ensure its policies are compliant and explain its process for leave. 
• Discount: Our annual sponsoring law firms: Larkin Hoffman (contact Phyllis Karasov) and Bassford Remele (contact Beth LaCanne) are offering a discount to AGC members to review their handbook for ESST compliance.

• Union Waiver. We have a final, signed agreement with the Operating Engineers, Carpenters, Laborers, Bricklayers, Iron Workers, and Cement Masons unions to waive the ESST statute. Instead of the statutory ESST, these unions are creating an earned safe and sick time that is better fitted to our industry, the Worker Wellness Program. 
• Details what is included in this agreement are here. 
• Note: Teamsters and union alumni employees are covered by the statute and not included in the waiver (Worker Wellness Program).
• Whether other trades, particularly Glaziers and Painters, join the WWP are to be determined.

Important Carpenters Northern MN Meeting

AGC and Carpenters are hosting a meeting in Duluth on December 18 to share market expectations and experiences, update on developments in Carpenters’ union, discuss the training center needs and performance, and explore opportunities to improve work and experiences. Carpenter leaders including Pat Nilson (new EST) and Mike Harrom (new leader of the North) will attend. Contact Mike for more information.  

State Office Building Renovation: Construction Subcontracting Opportunities

Next Wednesday, December 13, 2023, join the Department of Administration and prime contractor JE Dunn to learn more about subcontracting opportunities for the State Office Building renovation, the largest renovation project ever on the Capitol complex. Gain an understanding of the overall scope of the project, how the work is being broken into separate packages for bidding, and the timeline for the project.

JE Dunn and several first-tier subcontractors will be available for networking and matchmaking. JE Dunn's Supplier Diversity office, the Office of Equity in Procurement and APEX Accelerator will be on hand to answer questions about subcontractor prequalification, certification, and more.

When: December 13, 2023, 2:30pm to 4:30pm

Where: Senate Office Building, Conference rooms 1150 and 1200

95 University Ave W, St. Paul, MN 55155

Register here.

Questions, please email procurement.equity@state.mn.us.