Survival Strategies Employed by Construction Firms during the 2016-2017 Recession in Kaduna

Abstract

Recession has been found to severely affect the Construction Industry through reduction of construction projects output, decreased employment as well as profitability, and at times, results in firms becoming insolvent. This led to the development of various responsive strategies for survival. However, previous research efforts have overlooked the three success indices (output, profitability and employment conditions), which have been found to be the major areas affected by recession which can lead to the total collapse of a firm. The aim of the research is to assess the influence of survival strategies on the growth or decline of profitability of construction firms. The study then established the relationship between the experience and profitability of the firms. A quantitative approach using an online questionnaire survey was adopted for this study. One hundred (100) of the top customers of some selected banks were contacted and sixty-seven (67) of those firms agreed to participate in the survey and had the survey links sent to them. Forty-two (42) filled questionnaires were retrieved. The SPSS (version 23) statistics software package was used to assess the mean scores and Pearson’s chi-square test to assess the relationship between a firm’s profitability and the firm’s years of experience. The study found optimum utilization of workforce (Minimizing staff redundancies) to be the most used strategy; placing greater emphasis on marketing, building relationships, effective planning and management was rated as most important strategy; while trying new methods and technologies to improve productivity had the highest influence on growth in profitability. The study recommended that construction firms should make marketing to new clients and establishing a bond with existing clients a core job function while putting more efforts on understanding methods of optimally utilizing their existing workforce and eliminating staff redundancies.