Construction Industry Update September 2022



In our Construction Industry Update September 2022, we take a look at some of the issues and challenges that are plaguing our industry. The challenges and fallout from the Covid-19 pandemic continue to have an ongoing effect on the US construction industry so far in 2022, even beyond the immediate effects of health and human services. Most of our colleagues that we talked with agree that two of the most impactful challenges we are facing in the industrial constructions are the lack of skilled labor and the constant supply chain issues. Both issues cause major delays which both directly and indirectly adds to the overall cost of projects.

Skilled Labor

Before the pandemic, skilled labor was already a growing concern in the industry, and the pandemic only accelerated the growing shortage of skilled laborers. There are several factors that are contributing to these issues. The construction industry is aging quickly, adding to the shortage of skilled workers. In 2020, the median age for the construction industry was 42.9 and this continues to increase as the amount of training programs for younger workers decreases. 

This has limited many construction companies to working on less projects at once, which forces companies to become more selective when bidding on projects. This has also caused a significant decrease in productivity among workers, which prevents companies from completing projects on time. Worker inexperience does not only cause delays but can have a significant impact on the quality of a project. It also does not go without saying that older workers take longer to return from injuries, while younger, inexperienced workers get hurt more often on jobsites. These factors add to the growing concern with the skilled labor shortage in the construction industry.

Supply Chain

Supply chain issues have become an increasingly large issue in the commercial construction industry since the pandemic, as manufacturers in every industry are still trying to return to their normal production levels after so many shutdowns. Transportation costs have also risen significantly, which drives up the overall cost of materials. Another significant supply chain issue the industry faces is the increased shipping times, which can prevent projects from reaching completion on time. The rising cost of materials is also having a significant impact on the construction industry, as nearly every contractor has stated this has affected their company in a noticeable way.

Other Issues

The pandemic had a significant impact on the way everyone does business, and the construction industry is experiencing the same impact, if not greater. Many construction companies have been forced to work remotely, so collaboration through software and cloud-based applications has become necessary to ensure effective communication within the construction team. 

Looking Forward

Despite the current issues in the construction industry, many of these problems can be solved through companies investing in their future. One way companies can do this is by improving their connectivity, which will allow them to be more efficient with data entry and allow them to access this data from anywhere. Companies must also invest their time and resources into their employees. This is done by having the technology in place that will attract workers who can handle innovative practices. 

Investing in employees also involves offering skill training and programs to acquire the necessary qualifications in the industry. This is extremely important to reducing the growing amount of structural unemployment, who are workers that are unemployed due to no longer being skilled enough to meet the technological demands of their industry, rather than due to demand.

Some “Energywise” Solutions

At Energywise Solutions, we’ve been working to perfect the practice of “remote work” with our team. This has required an investment in technology such as computers and cloud-based applications to not only make our team’s work more efficient, but with an eye on facilitating improvements in the flow and quality of information we provide to our clients. 

We’ve also taken significant steps to cross-train and provide education/training to our employees and subcontractors to improve the efficiency and skill levels. This is not a on-time solution, but has to be an ongoing plan that assess strengths and weaknesses, evaluates changes implemented, and continues with a flexible plan on a long-term basis. We can’t solve all of the issues ourselves, nor can we solve the problems in one fell swoop, but we can continuously improve and grow to put our best foot forward with calculated and collaborative solutions that are impactful to our industry and craft.

Scott Van Kerkhove is the CEO of Energywise and writes on topics and issues surrounding the lighting and controls industry, energy management, future of construction industry, profitability and sustainability. Find us on Google+ – Author: Scott Van Kerkhove