The construction industry is bracing for another government shutdown, with contractors warning that furloughed federal employees could paralyze project approvals and oversight.
A government shutdown set for Wednesday would immediately freeze construction activity on cost-type federal contracts and related state and local work, as Congress and President Trump failed to reach a funding deal Monday, Construction Dive reports.
Fixed-price contracts with appropriated funds—the bulk of federal construction work—should continue unaffected, according to Associated General Contractors of America. That includes Infrastructure Investment and Jobs Act projects and Highway Trust Fund work, which aren’t subject to annual appropriations.
But cost-type contracts and awards in the pipeline face significant exposure. The key bottleneck: furloughed federal employees who provide oversight and approvals.
“The real problem is going to be the federal employees,” said Marsia Geldert-Murphey, senior associate at AEC firm GBA. “In many cases, we can’t move forward with the project if the federal oversight is not there.”
Urges Congress to find a better way forward
During the 2018-2019 shutdown, contracts in late-stage negotiations were delayed three to four months, creating cash flow and staffing challenges, said Erik Wright, principal at Precision Construction Services.
Extended delays force suppliers to reprice bids and contractors to remobilize crews at added cost. State and local projects tied to federal work face cascading effects if connecting infrastructure stalls.
“Any government shutdown creates uncertainty, including potential delays in federal infrastructure projects,” said Kristen Swearingen, Associated Builders and Contractors vice president. “ABC urges Congress and the president to find a better way forward.”
Myrna Whitaker 
Nils Lund 
Anna Broberg 
