The construction industry stands at a crossroads, with a tantalizing future ahead but significant hurdles to overcome. McKinsey’s recent report projects a staggering increase in global construction spending, soaring from $13 trillion in 2023 to $22 trillion by 2040. This surge is driven by unprecedented global demand, yet the industry grapples with a persistent productivity problem. Despite technological advancements, global economic labour productivity in construction has stagnated for decades. This stagnation is exacerbated by labour shortages, with the U.S. construction industry alone seeing vacancies nearly double from 2017 to 2023, now reaching 380,000. The impending retirement of 41 per cent of the 2020 construction workforce by 2031 will only intensify this challenge.
The need for innovation is clear. The construction industry must embrace technology to boost productivity and address labour shortages. However, the industry’s investment in IT lags behind other sectors, with less than a third of the investment seen in automotive and aerospace. The Royal Institution of Chartered Surveyors survey revealed a grim outlook, with less than 20 per cent of North American respondents reporting increased productivity in the past year, and a mere three per cent expecting improvement in the coming year. Labour productivity was identified as the primary hindrance.
The solution lies in adopting new innovative technologies and increasing the adoption levels of existing ones. Modular and factory fabrication methods, such as AUTOVOL’s automated fabrication of wall, floor, and roof panels, present a viable path forward. These methods reduce the need for onsite labour and enhance efficiency. Additionally, in-situ 3D printed concrete construction and robotic devices offer promising avenues for improvement. Robotic arms, wearable mechanical aids, and autonomous machines for material handling are just a few examples of how technology can alleviate labour shortages and boost productivity.
McKinsey highlights the importance of AI, digital twins, and Building Information Modelling (BIM) in design and planning, but the real challenge lies in translating these technologies into tangible worksite productivity gains. The integration of robotics into the construction industry, particularly for “dirty, dull, and dangerous” tasks, is a promising area of research. The University of California San Diego’s Jacobs School of Engineering is exploring how robots can use visual and 3D mapping to engage with objects, potentially revolutionizing the assembly of prefabricated components.
However, the high cost of these technologies remains a barrier for many companies. The industry must confront this challenge head-on, as future productivity gains will hinge on technological advances in building assembly and reducing the friction between design and construction. The construction sector must embrace innovation, not just in design and planning, but also in the execution of construction work. The coming years will be critical in determining whether the industry can meet the projected demand or if it will continue to struggle with stagnant productivity and labour shortages.