By David Redd, Content Director, HCSS

According to the U.S. Bureau of Labor Statistics, the unemployment rate in the construction industry was 3.5 percent in July 2022. The last time it was lower than this was in September 2019, about six months before the initial lockdowns from the COVID-19 pandemic, the lowest it has been for nearly three years; the labor shortage remains one of the most critical construction industry trends for 2022, per The Hartford

Per AssuredPartners, an independent insurance agency, “Nearly $1.4T worth of structures are constructed each year, and it employs more than seven million workers across 733,000 businesses.” For 2022, many of these businesses struggled with a shortage of qualified workers, supply chain disruption and material shortages, weather disruptions, and inflation issues. To overcome these challenges, many construction firms are turning to technology to manage their business better. 

HCSS, a construction management software provider, interviewed several of its customers about the future of construction. A summary of these discussions follows. 

The Future of Construction: An Interview with Teichert’s Mary Teichert

Mary Teichert is the President of Teichert, Inc., which is a 135-year-old contractor regionally based out of California and Western Nevada. It was started by her great-great-grandfather, Adolf Teichert, a foreman for the man who invented expansion joints. Ms. Teichert’s take on the top construction trends for 2023 include:

What does the industry need to do to engage employees more?

Engaged employees matter in the construction industry because many employees are the main face to the customer. Project engineers to the customer are the company. These employees need to be proud of your company and enjoy working there. For a company that has been in business for 135 years, many of our employees feel we are their employer of choice. 

At the end of the day, if you look at a road, you can’t tell who paved it. We all use the same specs and plans, but you can tell how well we are doing our work when we’re doing it. One of the things that’s a big compliment to the company is not only all these people who choose to work here for their whole careers but also the people that recommend their kids, their grandchildren, and their nieces and nephews to work here as well. 

While Teichert is a family business, Mary often points out that it is a lot of people’s family business, and 100 percent of that comes from engagement, with an employee feel valued, that their voice is heard, that their work is productive, and that they are interested in the tasks they must perform every day. 

Many dimensions make people want to work in any place. One exciting factor with our company is that most field forces are union folks, so the pay isn’t that different from anyone else. If you are an operating engineer at a certain level at Teichert, they make the same rate they would at any other place working for a different contractor in the same region. I’m proud that we have a well-paid industry and that people want to work in it daily. 

To accomplish this, the company invests in ensuring employees understand the mission and purpose of the business, the benefit of the infrastructure they are building, what their role is in making the work successful, and what this means to the customer. This is in addition to having a safe yet fun work environment. 

Safety is one of the centerpieces of the business, which focuses on sending people home safely to their families. Because we are safety-focused, employees know what they mean to the business and want to stay engaged. 

What impact do you expect environmental practices to have on the industry?

Teichert has an interesting contracting business because we also have materials plants made up of 25 rock plants in California and Nevada. Those are stationary facilities, which has led to a real depth of expertise in environmental management. Our employees’ skills and awareness roll over into saying that the company is a steward of the land they are working. The company and its employees know the emission requirements, how to test for stormwater runoff, and how to practice stewardship of the environment. 

As a regional contractor, most of the people who work here also live in the area, so they are more willing to want to take care of the resources around them. All of us live here and breathe this air and drink this water. So sometimes there’s balance, and we can all talk about whether some of the things we’re measuring and managing are the most important things or are worth the trade-off in costs. You must have a conversation because we spend millions of dollars yearly on our capital program, and replacing and buying equipment is a non-trivial prospect. 

Our industry also cares about things like small businesses and disadvantaged businesses. So you should be investing in more technology to keep the air cleaner if you’ve paid attention to what that means for someone with limited capital and who may not have used up the life of their previous equipment. It’s important to continually discuss these issues and requirements, understand the trade-offs, and focus on environmental management. 

The Future of Construction: An Interview with Eclipse’s Tom Agresta

Tom Agresta is the President of Eclipse Companies LLC, a heavy civil contractor based out of Geauga County, Ohio, just northeast Cleveland, and is a female business-owned enterprise. They primarily work in the heavy civil market and specialize in earth moving, underground utilities, and demolition. 

What are the future of supply chain and electronic material ordering?

With technology like HCSS, you can know where you’re at each day. You can know what you’ve installed for a material type that day, which gives you the delta, the yield of what you’ve done, and then the delta of what you still need to order. Pretty soon, with a click of a button on an app, someone will be able to release their next order. It’ll get even more and more simplified, which can impact everything from accounting to management and can even help from a supplier standpoint. 

Let’s face it. No job is ever coming out where they will give you more time. If you go back a couple of decades, specific jobs might have allowed you an additional three months. Well, for whatever reason, those time allotments are no longer there. So, when everything else is tighter and tighter, and we have less and less time to work on these jobs, material delays will impact something. It’s on the contractor to get the equipment and us to get the labor force out there, but I can’t control my material suppliers. I need to give them as much advance notice as we can. 

Technology allows our materialmen or vendors to track and watch what we’re doing so that they’re on top of it, too, so they’re not waiting until the last minute to release material. As we know, it does sometimes happen because there’s a human element to it. There’s so much going on in construction sites. There are more and more things that we are responsible for. Regarding supply chain and material ordering, technology will be great for catching errors and helping us be more proactive.

The Future of Construction: An Interview with Ed Bell’s Phillippe Falkner

Phillippe Falkner is the Safety Director and Business Services Specialist with Ed Bell Construction in Dallas, Texas. Ed Bell has been a heavy contractor in business here since 1963. They pave for the local DOT and local municipalities. 

How will automated equipment change the industry?

We underwent a first renaissance by automating many equipment functions 20 to 25 years ago. We saw significant gains in cost, quality, and the general scope of work and what we could accomplish in each period. Schedules were improved by the first renaissance when people were still in machines, but the machinery did more for them. 

As we move into this next phase with fully automated machines, whether they’re controlled remotely, where the machine uses artificial intelligence (AI), or the machine has some pre-programmed system, I think that companies will spend an inordinate amount of time and cost to determine how to use autonomous machinery. And hopefully, the machines will work with great success because it solves some of the current labor shortage issues.

There are quality issues that people often need to discuss. There is a large volume of new people hired and skills lost through attrition, retirement, COVID, or other factors. Automated equipment brings a new baseline to creating better quality. Automated equipment streamlines operations and solves labor challenges. Companies are very excited about automated equipment. Our owner has started soft-committing dollars and other resources as he sees the opportunity to add new, automated equipment. 

From a heavy highway perspective, automated equipment is a big challenge. If you look at some of the successes in automated equipment, they’re in sectors of construction or in the industrial world where the type of work is isolated, such as in mining. Some of the mines in Australia and New Zealand utilize 100 percent automated equipment. There is not one single human in the mine. There are some people up top running some control aspects, but otherwise, the mine is fully automated. 

Our biggest challenge for the industry, specifically the heavy civil and heavy highway disciplines, is that many projects still need ground-based people. Most of the automated equipment and driverless vehicles the world is seeing now are in a restricted, controlled environment. Nobody should be walking down the interstate. There’s nobody in this controlled access zone. 

The typical work site, however, could be more controlled. There will likely be a longer learning curve than expected because of the technological challenges that this machine must understand and process. How is the 45-ton off-road truck running at what you hope is 25 to 30 miles an hour and currently weighing 90 to 120,000 pounds going to be able to stop when a worker walks in front of it? Is it an obstruction? Is it something I go around? Do I stop? What should I do? There are many people and much small stuff going on at a jobsite, so there are still many challenges.

It will dramatically impact the labor force and the quality and schedule of work. We’re ready to spend those resources and those R & D efforts toward it. I’m optimistic about that. However, we are a very safety-oriented contractor with an excellent safety success record, so I’m going to be very reluctant to dive in full until I know our team will be safe. 

The construction industry lags other industries when it comes to technological advances. But this needs to change if the industry is to stay competitive. The faster information is shared, the more efficiently customers request orders and materials, and the more productive the workforce can be, the better off the industry will be when the next wave of disruptions comes around.