An estimated two-thirds of the nation's non-residential construction companies are planning to cut their payrolls, according to new employment and business forecast figures released Thursday by the Associated General Contractors of America. All told, those layoffs are forecast to result in a 30 percent decline in the number of people working on construction projects.

Those layoffs come on top of a 35 percent drop in contractor employment in the last year, according to the survey. Seventy-two percent of contractors said they have laid off worker in the last 12 months.

“Unless the business climate changes significantly and soon, the construction sector will continue to experience the kind of devastating job losses and crippling declines in business activity that will undermine efforts to end the recession,” Stephen Sandherr, the association’s chief executive officer said.

“After a strong start in 2008, we’ve seen a significant slowdown in commercial construction in recent months,” he said. “The last few months have been devastating for the construction industry, but without a stimulus package, 2009 will make 2008 look good by comparison,” he added.

The forecast results, which are based on a representative survey conducted by the construction association late in 2008, found no relief in sight for construction companies that already have been among the hardest hit by the economic slowdown. According to the forecast figures, the association’s member companies have seen or are planning for declining activity in every type of construction market.Ninety-two percent of building contractors and 93 percent of road builders are expecting or experiencing declining activity. Over 83 percent of utility contractors are bracing for declines while 77 percent of water resource contractors are expecting a decline in business building levees or locks.

Tracy Hart, president of St. Louis-based Tarlton Corp., said some projects her company had been awarded have been put on hold, and “competitor friends have seen projects cancelled because of financing.” She said Tarlton is taking this opportunity to invest in training, particularly in green construction, “because when construction comes back it will be green.” She admitted, however, that training is only a short-term solution, and but hopefully it will last until Congress and the President adopt an economic stimulus package and more money starts flowing into construction.

The AGC found that planned investments in infrastructure projects as part of the national economic stimulus package would dramatically improve the employment and business outlook for contractors for the year. Eighty-five percent of non-residential construction companies said they would either cancel layoffs or add new employees if states embarked on stimulus-funded infrastructure projects.

According to the forecast, construction companies would increase their payrolls by 25 percent if the stimulus included new infrastructure investments. And construction companies predict they would invest an average of $500,000 this year in new equipment if they received new work as part of the stimulus package.

“With a stimulus, construction companies can get more people to work and more money into the economy in a way that will immediately boost our economy,” Sandherr said. “Without a stimulus, construction companies will cut jobs, slash spending and continue to be among the hardest hit sectors within our economy.