Wyoming state government spending cutbacks have area commercial construction contractors feeling stressed, local officials say.
Work in the local commercial construction sector—much of which involves government projects—has taken a hit, partly from the economic downturn accompanying the COVID-19 pandemic shutdown of the economy. Planned state-funded projects have been postponed, and work involving schools, hospitals, roads and other state-funded work has all but dried up.
Generally speaking in construction, contractors can roughly gauge the overall health of the sector by looking at the amount of work scheduled “in the pipeline,” so to speak, in the upcoming 24 months to 36 months. But the pipeline of Cheyenne-area commercial construction is too short.
The local pipeline is down to just a year to 18 months of work, making some in the sector a little worried, said Heidi Peterson, Executive Director for nonprofit construction group Wyoming Construction Coalition, adding that the slowdown is sort of a delayed effect of the pandemic.
“We’re getting affected a lot later from COVID,” Peterson said. “The next year to 18 months, statewide, that’s our concern.”
Amid severe cutbacks in state tax revenues and spending, largely resulting from the pandemic shutdown but also due to softening fossil fuel prices, uncertainty abounds in commercial construction and related sectors like architecture and engineering.
Conversely, housing construction in the Cheyenne area is booming. Housing contractors here cannot keep up with the demand for their work. If it were only so, in commercial construction.
While it’s unclear how long the state’s cutback in construction spending will last, other ongoing and planned commercial construction work is a silver lining to the COVID-19 shutdown. The U.S. Air Force recently chose FE Warren Air Force Base as the first site in the nation to receive a modernized Intercontinental Ballistic Missile System. Northrop Grumman recently was chosen as the general contractor on the project, which is set to begin in 2023.
The upgrade of the base’s missile field is a long-overdue project of the military. It bodes very well for Cheyenne and is expected to create many construction jobs as well as add 300 to 600 employees to the air force base.
Even before it officially starts, the multi-year revamping of the missile field is proceeding apace. Currently work on two projects that are precursors to the missile field upgrade are ongoing: work on the weapons generation storage facility, and work on a new helicopter hangar are in progressing. That project work amounts to more than $150 million.
Despite the worries about the commercial construction pipeline, some in Cheyenne are reminding people the glass is half-full.
“The construction industry as a whole in Cheyenne right now is extremely healthy,” said Dale Steenbergen, Pres./CEO of Greater Cheyenne Chamber of Commerce. “But there’s a fear, as we move forward, that they’re busy right now, but their pipeline isn’t full.”
The upgrade of the missile system is expected to bring more than 1,000 jobs to Cheyenne.