Brick by Brick: Methods of Stabilizing Utah’s Construction Sector

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The construction and construction materials supply industries both play a substantial role in Utah’s economy with the latter specifically constituting roughly 1% of Utah’s GDP while being composed of 345 firms and employing roughly 4,569 people in the state. This group of firms supports the overall construction industry which makes up 7% of the state’s economy.

In light of the importance of the construction materials supply industry and its impact upon construction and the overall economy, the Utah Foundation undertook a study to examine the industry in the face of an expiring program used to stabilize it.

The key findings in Brick by Brick: Methods of Stabilizing Utah’s Construction Sector include:

  • The elimination of lien rights without an option being employed to protect actors in the construction industry from non-payment may inject friction into the construction industry when the state can least afford it.
  • Construction lien rights are currently under threat in Utah.
  • Utah’s Residence Lien Recovery Fund’s defunding may have been premature given subsequent trends in claims.
  • A significant portion of Utah’s construction industry is supported by short-term credit provided by construction suppliers.

The report focuses upon six main options for policymakers.

“This report explores the interdependency between building suppliers and the construction sector,” said the report’s lead author, John Salevurakis. “It does this while highlighting the significance of short-term credit, lien rights, and lien recovery to the future of the Utah housing market in an environment of ongoing shortage.”

Utah Foundation President Shawn Teigen notes that, “One option is to just let the Recovery Fund disappear.” Teigen suggests that “This could be dangerous, particularly at a time when so many Utahns are priced out of housing.”

Special thanks to the Utah Construction Suppliers Association for providing support to make this project possible, with added support from: Sunpro, Geneva Rock, Burton Lumber, LKL Associates, Plastic Specialties, Inc., Staker Parson Companies, Builders FirstSource, and the Utah Plumbing & Heating Contractors Association.

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