In our last post, we explained how some churches adapted to financial conditions from the Great Recession to successfully remodel or construct a new church building. Those examples focused on ways leaders altered their church designs. Recessions can cause other frustrations for church leaders. Here are some examples and ways to deal with these challenges.

The Importance of Staying Prepared

During recessions, churches sometimes stop future planning because it is difficult for them to do what they really want to do financially. The Great Recession demonstrated that, when things finally turned around, these leaders weren’t ready to react and take advantage of the improvement in circumstances.

Now, consider what happened after the pandemic. Many churches received relief money. Others saw offerings or tithing go up, and in all these situations, churches found they had a surplus of funds. Churches that hadn’t stopped planning were ready to move forward with projects, like doing a remodel, an addition, or long-term maintenance.

These churches were rewarded with some very good prices because they planned, they knew what they would do, what they needed, and where they were going. The churches that gave up planning missed these opportunities. The lesson is to always keep preparing, even when times are tougher.

The Cost of Waiting

During and after COVID, some churches were afraid to borrow money, perhaps because the financial uncertainty reminded people of the 2008 financial collapse. At the time, interest was extremely low—if you did borrow money, it was such a deal.

Now, interest rates have risen substantially. Delaying projects in the hopes of saving more down payment money or gaining improved economic conditions, rather than borrowing a reasonable amount early on to complete a project, might seem like a good decision, but it’s not without risk. We call it the cost of waiting. Nobody wants debt, but it can be an option to keep the momentum and growth going.

The Impact of the Labor Shortage

One unexpected result of the last recession was that tradespeople had no work to do, and prices fell. One project we bid on in 2008 came in $1 million under budget because nobody had work, and everyone was lowering prices. Compare this to 2023, with the current labor shortage.

It’s a crisis now because there are not enough people to do the work. Supply is not meeting demand. Factories are understaffed and paying more to make products. Many construction workers are retiring after working 20–40 years on job sites, and there’s a lack of trained, skilled construction workers to replace them. So, productivity has taken a dive as well. As a result, prices are going to stay higher for longer, and it’s going to take longer to do things.

However, remember current labor woes don’t mean you should stop planning. As we’ve seen in the past, things can change quickly. If and when prices drop, with planning, you can move more quickly than without it.

Want to learn more? Join us for our free i3 webinar series. Each session addresses a different topic or trend in the church building and design industry, and we’re happy to answer your questions.