By Olga Peters, Vermont Business Magazine

Anyone familiar with hiring tradespeople in Vermont is aware of two things:

1. Tradespeople, from solo practitioners to small homebuilders and large multi-state companies, are busy.
2. There aren’t enough of them.

On a positive note, the industry ended 2024 on a high and is expected to have another productive year, provided the necessary materials are available.

However, the looming threat of tariffs remains a major concern, causing some professionals to add a word of caution to their optimistic forecasts.

A key date to watch is April 2, when the Trump Administration plans to impose 25 percent tariffs on goods from Canada and Mexico.

“We’ve been working with multiple developers across the state, and it looks like it's going to be another good year,” said Richard J. Wobby, Jr., executive vice president, director of safety training, and member services at the Vermont chapter of the Associated General Contractors (AGC/VT).

Matthew Wheaton, executive vice president and principal at DEW Construction, shared a similarly optimistic view: “Owners are still sending out projects to the marketplace, so there's still a lot of activity and opportunity for everybody. Our outlook looks great for ’25, knock on wood.”

However, TJ Kingsbury, whose company handles heavy civil construction and public infrastructure work, offered a more cautious perspective due to rising material costs.

“I'll tell you how Vermont's going. It's pretty anemic right now,” Kingsbury noted. “There's not a lot of work out to bid.”

Kingsbury Companies is working on substantial upgrades at the Swanton wastewater treatment plant and a sewer project in Colchester. In 2025, they will also be expanding into New Hampshire and New York.

Kingsbury observed that many of his company’s bids have exceeded owners' budgets, largely due to the combination of inflation, escalating material costs, and wage increases during the pandemic.

Joshua Reap, president and CEO of Associated Builders and Contractors of New Hampshire and Vermont (ABC NH/VT), acknowledged the industry's adaptability in the face of change.

“There’s some uncertainty when it comes to material sourcing, in relation to the tariffs that the federal government is imposing on certain goods that are coming in from Canada and Mexico,” Reap said. “You know, our industry is fairly resilient. We'll adapt.”

Despite the challenges, Wobby remains determined to maintain a level head. Contractors, he said, are focused on avoiding unnecessary drama.

“If we react to any of it, we're bringing drama to the conversation, and contractors generally don't bring drama to a conversation,” he explained. “They plan for the future and see what we can do to best supply our developers or our contracts along the way.”

Every construction project, Wobby noted, involves careful planning, but also an element of uncertainty. Contractors can develop detailed plans for a site, but until work begins, much remains unknown.

Preparing for Tariffs and Future Uncertainty

For Vermont-based contractors, tariffs on Canadian supplies are among the biggest concerns.

AGC’s members are proceeding as though the building season will be busy, as many state and local projects continue under funding from the ARPA and the Infrastructure Investment and Jobs Act (IIJA). Wobby emphasized that contractors are working with government agencies to clarify expectations for the next 12 to 18 months.

Despite the uncertainties surrounding tariffs and federal funding freezes, Wobby believes the industry is on a positive trajectory for growth.

Ultimately, local contractors remain focused on their core priorities: “finding work and delivering that work ethically and competitively and profitably for the communities in which we live and work,” said Reap.

DEW Construction continues to diversify its project portfolio, which now includes court houses, breweries, medical projects, and over 600 units of multi-family housing across multiple states, according to Wheaton.

The unpredictability of the market has led many contractors to develop robust backup plans. Wheaton explained that tariff concerns have intensified discussions about risk management and how to best protect clients and contractors alike.

“We just are very unsure of how it'll play out over time,” Wheaton admitted. “We're hopeful that it's all manageable, but it's still very new.”

Wheaton also shared his hope that the federal government might reconsider tariffs on materials crucial for the housing industry, which is a key focus nationwide.

Despite the ongoing challenges, he remains optimistic, noting that few owners have canceled projects. This, he believes, indicates that the market will adapt, with modifications to materials and local sourcing helping mitigate potential price hikes.

Some contractors, like Michael Monte, CEO of Champlain Housing Trust, are taking a proactive approach by including contingency measures in their contracts to account for tariff-related cost increases.

“We’re concerned about tariffs and the impact tariffs will have on costs and how developers and builders are all looking to create a contingency, which is fairly high,” Monte said.

Others, such as Dave Dancosse, president of All Seasons Construction Corp., are still adjusting to a new baseline after the pandemic. However, the looming tariffs complicate the situation.

“We don't know what that looks like yet, but we do expect that it's going to wreak havoc with the cost of materials, which is something the industry really doesn't need and the consumer certainly doesn't need,” Dancosse said.

Originally reported by Vermont BIZ.