Worker shortages, supply chain troubles mark 2022 construction trends

Like all business and industry segments, construction was significantly impacted by two years of pandemic disruptions and continues to grapple with its lingering effects. Projects were interrupted, workers idled and development plans set back by months. As we move into a different phase of living with the pandemic, construction projects across the nation are back in high gear, only now presenting the industry with additional complications caused by trends that, while present before the pandemic, have been amplified by the continuing effects of the past two-plus years.

As we approach Construction Safety Week 2022, let’s take the opportunity to explore two of the most significant trends that will continue to affect construction in the near term, and look at some of the evolving solutions that will shape the future of the business.

The disappearing worker

The most significant trend in the construction industry today, and likely to continue to stress the business for some time, is a persistent and intensifying labor shortage. According to the Associated Builders and Contractors (ABC) organization, the construction industry needs to immediately attract nearly 650,000 additional workers over and above its normal pace of hiring in 2022 to meet the increasing demand for labor. ABC’s 2022 workforce shortage analysis sends a stark message that the construction industry desperately needs qualified, skilled craft professionals. The situation is especially problematic since the passage of the Infrastructure Investment and Jobs Act in November 2021, which will pump billions in new spending into the nation’s critical infrastructure, further intensifying the competition for qualified craft professionals.¹

What has been called the Great Resignation has also rippled across the economy, as older workers opted for retirement in the shadow of the pandemic, and even younger workers saw opportunities to strike off in new work-life directions. The construction industry was impacted by this trend as well, exacerbating an already growing labor shortage.

Consequently, the urgency of the worker shortfalls in construction has resulted in contractors seeing no alternative but to hire younger workers less qualified than employers would prefer to fill desperately needed positions. And, in an industry subject to a higher number of workplace accidents and injuries than other professions, an influx of younger, less experienced workers presents obvious safety issues.

Adding to challenges facing many contractors is the reality of an increasingly multigenerational workforce, as those younger, less experienced personnel work alongside older workers who remain on physically demanding jobs longer than they have in the past. The potential for sprains, strains and other injuries among older workers will continue to drive accident and medical costs borne by builders trying to cope with a super-competitive workforce marketplace.

Directly taking on the worker shortage, many firms are now reaching out to high schools to recruit trainees upon graduation into skilled trades that will be sorely needed in the years ahead. Industry trade associations are also recruiting on behalf of their members, communicating to young people not focused on attending college that there are lucrative, lifelong opportunities available in skilled construction trades with the right training and professional commitment.

The frayed supply chain

Skilled construction workers are not the only commodity in short supply. Like so many industries, construction is beset with supply chain woes affecting materials needed by virtually all phases of construction, including products historically readily available. Material lead times are growing exceptionally long, not just for specialty items but for commonplace materials. We hear from many contractors that insulation, PVC piping and roofing materials are becoming increasingly difficult to find on time and on budget. One customer in the construction of wastewater treatment facilities told us of 30 to 40-week wait times for some materials, which can increase costs by requiring a search for materials from other sources.

Much of this is no doubt due to production backups due to the pandemic, complicated by pent-up demand as projects got back on track as surges in the pandemic have eased. The situation has been complicated by rises in regional demand for widespread repairs and rebuilds due to an increasing number of damaging severe weather events. And a shortage of qualified drivers in the trucking industry has complicated reliable, on-time material deliveries. While we expect today’s supply chain bottlenecks to ease in time, they will continue to affect project schedules for at least the near term.

To avoid negatively impacting their project schedules contractors must engage considerably earlier in the procurement process. Ordering materials much earlier, paying premiums for expedited shipping, and much closer tracking and monitoring of supply chains and distribution are needed since the lead times of the past can no longer be relied upon.

Technology building the future

Despite today’s challenges, the construction industry remains resilient, dynamic and ready to integrate innovative technologies and approaches aimed at building better and building more sustainably. As is the case in all industries, the adoption of new technologies in construction promises to bring about a sea change in how projects are planned, executed and completed. Some of the technological solutions at varying degrees of development and onsite application include:²

Digital twin technology

A digital twin is a computer program that employs real-world data in simulations able to reasonably predict how a product or process will perform under actual conditions. Digital twins can provide data during the pre-construction and design process to help prevent costly rework and mistakes. Machine learning and artificial intelligence have enabled these virtual models to become common in modern engineering, driving innovation and improved performance.

Growth of digital construction

Like digital twin technologies, digital construction processes such as Computer Aided Design (CAD), Building Information Modeling (BIM) and Virtual Design and Construction (VDC) will continue to gain momentum and play even larger roles in construction in the years ahead, thanks to more powerful technology and software applications.

Expansion of AR and VR technologies

The remote capabilities available to architects and engineers through Augmented Reality (AR) and Virtual Reality (VR) will continue to revolutionize the industry, helping to dramatically reduce pre-construction costs in the early stages of a project. Using interactive experiences, construction professionals will be able to examine designs and coordinate changes without visiting the site. While widespread adoption will take time, the viability of these technologies is already being demonstrated in the field.

Use of onsite data and analytics

It has been estimated that poor data accounts for about 48% of rework on construction sites.³ As remote operations increase, the use of pre-construction and construction software will increase as well, providing faster, better access to remote data in time to head off errors. Project leads will have greater access to data to analyze the build no matter where they are.

Robotics

The field of robotics is poised to begin assisting construction workers by performing and augmenting small and repeatable tasks that will take some of the pressure off skilled trades. Some construction firms experimenting with robotics have already found that these technologies can multiply human ability and increase productivity.

Blockchain for supply chain management

As the pandemic wanes, production shortfalls and logistical problems have disrupted trusted supply chains, contractors will need to diversify supply chains in ways that prioritize trust and customer experience. A study by Deloitte projected that some construction businesses may begin to utilize blockchain technology for supply chain management, making recording a material’s price, location, quality and other important information transparent, traceable, and easier to manage.⁴

Utilization of recycled resources

The ongoing materials shortages could prompt more interest in utilizing readily accessible recyclable resources. According to the World Resources Institute, 40% of waste in landfills is generated by construction and building.⁵ Instead of sending these materials to landfills, construction could reclaim and reuse many of them. As supply chain disruptions continue, a growing number of contractors may commit to the use of recycled materials.

Increased modular construction

Prefabrication and modularization techniques offer several benefits, from manufacturing components indoors out the elements to the speed at which finished elements can be assembled onsite. With the advent of more sophisticated and capable 3D printing equipment, construction components may even be fabricated onsite and immediately fitted into place. Modularization is not new. It has been accelerating in commercial construction for 10-15 years. But for a variety of reasons, expect these techniques to reach new heights in the future.

A new breed of construction workers

Ironically, the explosion of technology solutions will open a host of opportunities for skilled IT technicians who may have never considered a career in construction. From performing CAD operations to piloting drones, an influx of IT professionals will help to remake the industry in the years ahead. The application of innovative construction technologies will also expand opportunities for disabled veterans and other workers non-skilled in construction who can play important roles in the manufacture of prefabricated building elements.

Looking ahead, the synergies of new technologies combined with innovative, new materials and approaches will reduce costs, increase energy efficiency and help to build better structures more carbon neutral, sustainable and cost effective.

1. “ABC: Construction Industry Faces Workforce Shortage of 650,000 in 2022.” Associated Builders and Contractors. 23 February 2022.
2. Brown, John. “The Future of Construction: 10 Technologies and Trends to Watch in 2021.” Construction Executive. 14 January 2021.
3. Xu, Allison. “Construction Tech Startups are poised to shake up a $1.3-trillion-dollar industry.” TechCrunch. 17 November 2020.
4. Using blockchain to drive supply chain transparency: Future Trends in Supply Chain. Deloitte. 2017.
5. Mittal, Tushar. “Four Steps to Adopting a Circular Economy in Commercial Real Estate.” Forbes. 16 December 2020.