The View From Your Recession

A reader writes:

I work in heavy/highway civil construction as a project and quality control manager. My company focuses primarily on concrete paving, but we also perform mass excavation and earthwork, roadway building, and underground utilities (water, storm, sanitary, etc.). Most of our work takes place at one of the major airports in the DC/Baltimore region, but we've also done numerous projects over the years for the military, state DOTs, and various private owners.

I got laid off yesterday morning.

I had worked for my employer for 4-1/2 years. My boss told me that I was the first of several cuts he was going to have to make over the coming weeks. A few hours later, a fellow project manager who had been there nearly 10 years also got laid off. More layoffs are coming, for both salaried office staff like me and for the hourly field workers. Work has simply dried up. We can't compete. And it's not just us. Some construction companies, including the biggest names in the D.C. area, have reduced their workforces by over 90% just to stay afloat. Others have gone bankrupt.

With the collapse in residential construction, and with commercial construction struggling badly, contractors have directed their focus on government projects. For instance, my company bid a small ($600,000) project to demolish an existing government building, haul the material offsite, and restore the work area with new topsoil and grass -- a two, maybe three month-long project. How many contractors bid for this project? THIRTY-SIX! THIRTY-FRIGGING-SIX! Three years ago there probably would have been no more than six or seven bidders, because everybody was so busy. My company cut our bid to the absolute bone, then cut some more. I think we came in 7th or 8th place.

Every bid for government or public authority work we've submitted as a general contractor over the past year has been at cost, meaning break-even. Right now, as my boss told me yesterday morning, we can't even buy jobs (i.e. bidding contracts) at a loss just to keep revenue coming in and the field guys busy. One proposal we got recently was to rent some of our off-road trucks to move dirt at a project in Northern Virginia. The guy wanted our trucks at a monthly rate that was almost $2,000 less than monthly payment alone! Like I said, we just can't compete in that type of environment.

On a personal level, I'm fairly well-equipped to ride out the storm for a few months. My boss will pay me through the end of this month, I'll be able to draw unemployment if I choose, and I have personal savings in the mid five figures. That should be enough to pay the bills for a little while -- at least a year, if I still can't find any work.

I'm optimistic that I'll land on my feet and find a new job at some point over the next few months. But I was unemployed earlier this decade for nearly two years, so I'm preparing for the worst.

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