Slow payments are predicted to cost the construction industry $136 billion this year, up 36% over 2020 levels.
The latest Construction Payments Report from Austin-based construction finance software firm Rabbet reveals that 72% of subcontractors would offer a discount in exchange for payment within 30 days, while 67% of subcontractors say they'd choose not to bid on a project due to a GC or owner's reputation of slow payments. About 35% of all general contractors surveyed say work has been delayed or halted thanks to a delay in paying crew members over the last year.
Typically, costs associated with slow payments are passed on to real estate developers and financiers in the form of project delays and higher bids from contractors, Rabbet said.
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