Market Trends That Will Stay

All of the events surrounding the pandemic had a significant impact on the market, and the HVAC marketplace was no exception. While some sales and business trends will likely revert to pre-COVID norms, various HVAC associations weighed in on which trends they see having a lasting impact.

Mike Star, president, Lane Associates spoke on behalf of Mechanical Contractors Association of America (MCAA), explaining that people’s concept of buildings has shifted. While ideas like healthy buildings (enhanced IAQ via filtration, ventilation, and temperature/humidity tolerances) have existed for decades, COVID-19 threw a spotlight on the need to incorporate systems into buildings that will preserve health.

The concept of a high-performance building has also evolved. The term is typically used in relation to keep buildings energy efficient and with a small carbon footprint, but it has grown to include enhancing the health of a given space.

“As long as buildings need to be comfortable, we’re going to have work to do,” said Star. “Indoor air quality, ventilation, and occupancy schedules are going to be looked at very closely.”

The pandemic also shed light on specific sectors of infrastructure that need HVAC upgrades, according to Barton James, president and CEO of ACCA (Air Conditioning Contractors of America). This was especially true for the state of HVAC in America’s schools. ACCA released a report of HVAC in the nation’s schools during the pandemic, revealing the immense need for upgraded HVAC systems. Nearly $100 billion from the federal government was allocated for schools to keep students safe.

All of this has led to the HVAC industry being perceived increasingly as belonging in the topic of keeping people healthy, and not as simply one of the necessary systems for building operation.

“Air quality has definitely become a recent focus and put HVAC in a spotlight, with government officials specifically addressing ventilation rates and filtration quality,” said Star. “There will definitely be some relaxing of these ideas, but some will likely stick around.”

 

Business Trends That Will Stay

The COVID-19 pandemic also shifted the way that many businesses performed their operations, such as introducing new safety guidelines and remote work.

Jeff Matulich, vice president of marketing and member service at the Electric & Gas Industries Association (EGIA), said that the pandemic taught contractors about the importance of preparedness in every element of doing business. One example is the transition to running a business remotely. Many companies had never considered the need for having a plan for that contingency, and so were caught unprepared. Shifts toward digital and contactless payment, both in person and online, were quickened by COVID-19. In addition to this, contractors learned how to manage flexible work schedules and how to create a company culture when employees were not meeting in the office.

“Incorporating more online, always-accessible processes — from overall operations to virtual meetings and training — will pay dividends down the road, whether it be because of another unforeseen event or simply in terms of increasing operational efficiency,” said Mautlich.

Pete Danielson, vice president of market development, Service Nation Inc., explained that digital meetings are here to stay, not only in internal business communications but also in communications with consumers, both residential and commercial.

“In our company, we're no longer referring to [digital meetings] as virtual meetings,” Danielson said. “When you think about virtual reality, you think about altered reality that isn’t truly real. But these are not virtual meetings — these are real meetings, and we get real stuff done. And we have real connections with human beings.”

When serving homeowners, contractors can utilize digital meetings to help with initial consultations, follow-ups, or relieving discomfort about technicians coming to a home when the owner isn’t personally there. They may even take the place of phone calls, as companies could use them to connect with customers after appointments.

Similarly, Colleen Keyworth, vice president Women in HVACR and sales and marketing director, Online Access Inc., sees video meetings becoming more of a staple. Women in HVACR moved to weekly meetings with its members, and Keyworth said that she has seen a growth in people’s comfort with being on camera. Plus, contractors and organizations were able to have some time to work on connections and networking that had occurred at pre-pandemic events or at virtual events.

The pandemic has also revealed the importance of keeping products affordable, especially in a time where supply chain disruptions have led to widespread price increases on the manufacturer side. Solutions such as financing can help customers afford the system they want.

“If contractors aren’t offering affordability options, the end user is going to end up buying the cheapest product that they can afford,” Danielson said. “The contractor will lose out in that case, and the homeowner will lose out as well, because they're not getting the product they wanted. They simply got the product that they could afford.”

One of contractors’ first major victories in the pandemic was being deemed an essential business by the government, which emphasized the critical role HVAC plays in keeping people both comfortable and safe, especially in regards to keeping critical facilities (such as hospitals) successfully cooling patients and ventilating pure air. ACCA’s James explained that this did bring up an interesting dynamic, as technicians were deemed critical and entering into people’s homes, but this caused contractors to wrestle with their liability should that technician contract COVID-19 on the job.

 

The Labor Shortage

One of the largest challenges going forward, which is little surprise to those involved in the skilled trades, is the labor shortage. For companies that have seen revenues drop and perhaps even needed to lay off employees, the problem of hiring quality talent grows even more.

“As employees, patients, students, and others now return to the built environments, they are demanding proof the spaces are safe,” said Star. “This is contributing to the already tight labor market. Too few techs are standing on the sidelines waiting for projects, and even fewer are entering the trades.”

According to Keyworth, Women in HVACR has used the past year to work on bringing up more scholarships and recruitment opportunities for the industry, creating and releasing tools such as slideshow presentations and videos to help with hiring.

“There’s not enough online stuff to show the younger generation what opportunities we have, whether that be using social media of TikTok videos,” Keyworth said. “We’re trying to address that issue with our organization and provide materials to people who don’t have the ability to get them currently.

 

Plans Going Forward

The industry’s organizations have worked hard the past year to equip contractors with the skills and tools needed to adapt, and even thrive, in a challenging, shifting market. And the organizations plan to keep doing this.

EGIA has ramped up investment in its Contractor University, which offers continuing education and online training video classes, along with other resources. The group is also planning on hosting EPIC2021 in Las Vegas in October, in-person.

“Simply put, our top priority is contractor success, and we’ll embrace both time-tested and brand new strategies to help them achieve it,” said Matulich.

MCAA views its role as delivering vital information to its membership via best practice peer panel webinars, timely presentation series with ideas/success stories for business management, and organizing speakers from various sectors of the HVAC industry (manufacturers, real estate experts, etc.) to inform their membership. They plan to continue informing their membership going forward.

James said that ACCA has seen its highest membership than ever before. The group is working to improve continuing education in the HVAC industry, and to attract people to the HVAC in an effort to overcome workforce challenges. In addition, ACCA is continually working on keeping its standards up-to-date.

“We offer products that show people how to do things the right way and allow instructors to teach those subjects, whether it’s Manual J or Manual S or other commercial products,” said James. ACCA plans to hold its Fall Forums on Nov. 1-3, 2021, and the ACCA 2022 Conference and Expo in St. Louis on March 28-30, 2022.

Service Roundtable recently launched Service Nation News, a video news broadcast, and is working to expand the business coaching that it offers. On May 13-14, the group held the Barefoot Roundtable event, which met in-person on a beach in Florida.

“We're helping contractors to build training processes and build recruiting instruments to help get more people into and staying in the trades,” said Danielson.

According to Keyworth, Women in HVACR grew in both membership and sponsorship over the pandemic. Women in HVACR is currently planning its 18^th annual conference, which will take place on Oct. 13-15, 2021, in St. Petersburg, Florida, with the theme “Breaking the Surface: Overcoming the Waves of Change.”

“The No. 1 thing people are looking for is trying to find a new sense of what business looks like,” said Keyworth. “You’re coming off of COVID, you’re getting into a new way of doing business, you have new customers, and there are new opportunities.”