Blog Post

What’s Next for Construction in 2022? Here are the Key Trends to Expect

Posted by Ken Pittman

Watching construction trends

There were a lot of hopes pinned on 2021. Overall, the construction industry came through with a strong recovery after a year of shutdowns and figuring out remote work on the fly.

Still, not all of 2020’s challenges went away for construction this past year, and forecasts indicate they may persist into the next year, too.

Here are some of the biggest trends to watch in the construction industry for 2022.

1. Continued Growth

The construction industry is staying strong as the economy continues its recovery – in fact, construction could be a main driver of that recovery as demand continues. According to this study by Deloitte, 91% of E&C industry respondents had a somewhat or very positive outlook for their sector moving into the new year.

Residential building has stayed strong throughout the pandemic period, despite supply shortages and resulting high prices, whereas nonresidential building has largely floundered.

2. Supply Chain Hiccups Persist

Construction professionals are flexing their problem-solving muscles, as they attempt to source or find work-around supplies for their projects. Lumber, paint, cement, and steel are some of the toughest materials to source, leading to delays on projects and increased price points for new builds.

In fact, 75% of E&C firms reported delays resulting from material shortages, and many report unpredictable delivery times. Planning on projects takes extra finesse when materials may come two weeks earlier or four weeks later than expected.

High prices naturally follow low supply, and that’s exactly what happened to some of the main materials contractors need to do their work – some supplies realized double-digit price increases each month during the first half of last year.

Fluctuations in commodity prices and scattered delivery timelines make it difficult to accurately price and schedule projects, so although prices are expected to cool somewhat next year, fallout will be longer lasting.

3. Labor Shortages

Labor shortages have been plaguing the industry for years – it’s almost not news anymore. But with an attempted recovery going on, finding and keeping good talent is going to be a make-or-break for contractors. Projects may be delayed, canceled, or scaled back if there aren’t enough workers to do the jobs.

Further, labor shortages may disadvantage contractors enough to hold them back from bidding at all, or it may keep them from exploring innovations – both impacts that could reach beyond individual companies and into the industry as a whole.

Interestingly, innovations in construction technology have created another skill set that needs filling within construction firms. Workers now must be savvy enough to integrate technology into workflows.

While this may present a challenge for the current workforce as they try to adapt to a new way of doing things, it also could be the key to tapping into a new labor source. Currently construction has a bit of a reputation issue. Historically construction has come across as a blue-collar, low-brow career. Even now after years of trying to recruit new workers, 61% of Millennials report that construction is a “dirty job.”

A focus on smart construction – efficient, forward-thinking firms that use the latest tech tools available – could elevate the industry’s reputation and engagement among young workers.

Other suggestions for attracting talent include promoting your company as one that provides high pay and has plenty of opportunity for advancement, as well as offering more apprenticeships.

Going forward, labor and skilled labor attraction and retention is going to be a paramount consideration for successful firms.

4. Technology for the Win

Even beyond worker engagement, technology is the way forward for construction. Connected construction is taking hold in the industry and it will be increasingly harder for holdouts to compete.

Digitization improves productivity, efficiency, and safety, all of which can independently improve a company’s bottom line, and competitiveness for both bids and employees.

Specifically, construction companies are using technology to better connect their office and site teams for end-to-end knowledge bases and analyses of operations. Further, tech tools that help individual companies range from AI to digital twins to drones, bringing construction fully into the digital era.

Not sure where to start on your tech journey? Efficiency starts with good record keeping. Device Magic allows you to create custom digital forms, to systematically collect fulsome data from your construction sites via any mobile device. Disseminate information easily between teams, retrieve accurate data whenever you need it, and never lose site data under the truck mats again.

The Outlook is Good

Construction has a long way on its road to recovery – industrial builds still lag and delays thanks to supply and labor issues are expected to continue throughout the next year – but overall the forecast for the industry is good.

Residential construction, while possibly not as hot as 2021, is expected to stay strong in the coming year. Construction is finding its legs in technology, and learning new ways to recruit and retain employees. The building industry is resilient, flexible, and critical to the overall economy, and 2022 is bound to be an exciting year of growth!

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