By Ro Bhatia, PlanHub
The construction industry is facing significant challenges, such as scarcity of skilled labor, rising material costs and lead delays that have carried over from pandemic-driven supply chain issues like transport bottlenecks and geopolitical uncertainties. But despite these challenges, contractors, subcontractors and material suppliers are moving forward with an optimistic mindset.
A recent survey conducted by PlanHub found that eight in 10 (82%) of general contractors and 80% of subcontractors plan on growing their business in 2023. Also, according to the American Institute of Architects, commercial construction is expected to grow by 6% in 2023, and industry professionals are turning to technology to help them prepare to reach their expansion goals amid an economic downturn.
Technology to the Rescue
Greater use of technology across the construction industry helps companies increase efficiency, streamline operations and mitigate labor shortages. To weather the economic slump and labor scarcity, construction professionals rely on digital solutions that increase collaboration and improve margins through greater productivity. And the proof is in the pudding, with 91% of general contractors and 82% of subcontractors planning or considering using new technology in 2023.
A cloud-based preconstruction platform connects general contractors, subcontractors, owners and material suppliers to build relationships and improves how they collaborate, manage their business and win more projects. In addition, this advanced technology helps streamline the bidding process, accelerate takeoff and secure more leads, so contractors and subcontractors can spend more time enhancing their skills and hiring quality talent to move their business forward.
Building a Successful Sales Pipeline
By leveraging a comprehensive cloud-based preconstruction platform, suppliers are connected directly with general contractors, and subcontractors can get their products in front of them as quickly and efficiently as possible. In addition, by having an easy-to-use sales and collaboration platform, suppliers and other construction professionals can boost their revenue and focus on building their teams and hitting the ground running with new client projects.
Hiring and Onboarding New Talent
One significant and long-standing challenge confronting the construction industry is a profound shortage of skilled labor. According to Associated Builders and Contractors (ABC), contractors must hire approximately 546,000 workers in 2023 to be in a healthy place to meet the demand for jobs and grow their businesses as the construction worker shortage hits half a million.
Added to this challenge is the coming construction worker retirement cliff. The aging of our workforce is a problem for many industries, but the construction industry will be hit particularly hard. ABC reports that nearly one in four construction workers is currently over 55, meaning the labor gap will widen year by year as this generation steps into retirement. This means longer hours and less downtime for current skilled construction workers, causing burnout and frustration while adding pressure to wages.
To help respond to this labor crisis and get quality, skilled talent on the payroll, certain best practices provided by technology can be implemented to take full advantage during the hiring and onboarding of new employees.
First, employers must have quick access to a broader talent pool. Technology can help contractors and subcontractors find and hire skilled workers from anywhere in the world, which can be especially helpful in areas with a shortage of workers, allowing contractors to tap into a wider pool of talent to fill critical roles.
Regarding onboarding, a preconstruction solution accelerates the process and provides employers with necessary data on their workforce securely and in good time. This comes in handy for companies low on HR professionals and in need of quickly moving forward on
One of the best ways to implement substantial and consistent growth is by having a competitive advantage. Technology can help contractors, subcontractors and material suppliers stay competitive in an increasingly challenging market. Why? Companies that adopt new technologies and processes are more likely to win contracts and attract top talent, ultimately driving growth and profitability.
According to PlanHub’s industry report, since the beginning of 2021, a 324% increase was seen in the number of general contractors posting their first projects on PlanHub’s platform, and projects with activity increased by 231%. By leveraging preconstruction technology platforms, general contractors have been able to expand their invitations to bid by 35%.
Not only are more contractors leveraging tech to grow their businesses, but they are proving to know the importance of being able to offer well-rounded services by expanding their skill set and services. As such, the aforementioned survey report shows that 44% of subcontractors said they plan to provide more trades in 2023. In addition, subcontractors have responded to adversity by seeking new ways to find business. They expanded their reach by listing up to 20% more trades and boosted their service area by nearly 50%.
Another bright spot for contractors, subcontractors and suppliers is the positive effects of the passage of the Infrastructure Investment and Jobs Act in November 2021. According to PlanHub’s Q2 Thriving in the Dynamic Construction Market report, there was a 500% increase in civil construction projects posted to the platform in Q1 2023 over Q4 2022.
In short, technology has significantly impacted and transformed the construction industry, allowing for increased efficiency, accuracy and productivity. Preconstruction bidding technology has enabled the industry to improve talent recruitment and retention, reduce costs and minimize waste. In addition, integrating such technologies has revolutionized how construction projects are planned, designed and executed by growing their talent pool amid staffing shortages, winning more bids by building stable relationships within the industry, listing more trades, and developing and retaining skilled talent. As the industry continues to evolve, companies must stay abreast of emerging technologies and incorporate them into their operations to remain competitive. The future of construction is increasingly reliant on technology, and those willing to embrace it will undoubtedly be at an advantage as they return to work.
Ro Bhatia is the CEO of PlanHub, the leading cloud-based preconstruction platform that enables general contractors, subcontractors and suppliers to connect and collaborate on construction projects across the United States. PlanHub was created by contractors, for contractors, to simplify the construction bidding process. Learn more at www.planhub.com.