Impact of COVID-19 Pandemic on Construction Business in Nigeria

Abstract

Construction is one of the most important sectors in the Nigerian economy employing a large number of people in its workforce. The industry contributed 4.09% of real GDP in 2019 to the Nigerian economy. This contribution may nosedive if concerted efforts are not made as a result of the outbreak of the novel coronavirus. However, the spread of the coronavirus pandemic has continued unabated across the world, and both public and private sectors have formulated different ways of responding to the pandemic. Their responses have attendant economic impact on all sectors of the economy, but that of construction seems to be the dire. The study is therefore aimed at analysing the impact of COVID-19 pandemic on the operations of construction businesses in the Nigerian construction industry. The study adopted quantitative research approach using questionnaire survey to obtain data on construction businesses from major stakeholders’ in the industry. A combination of snowballing and purposive sampling techniques were used to obtain 312 valid responses used for the analysis presented in this paper. The study reveals that the most severe impact of the COVID-19 is financial with 77% severity index, this is followed by infrastructure impact with 74.4% while quality and safety impacts is the least ranked category with 53%. These findings showed that the outbreak of the COVID-19 have significant impact on construction businesses. The study recommends that parties to construction contracts should consider providing expressly outbreak of this nature in future in their contractual arrangements with a view to dealing at the outset with the risks associated with them. Government should provide palliatives for the construction industry post COVID-19 to be able to counteract the effects of the pandemic going forward. The study has implication for the practitioners in the Nigerian construction industry as well as the policy makers to understand the significant role being played by the industry and its effect on other sectors of the economy.