How Connected Construction is Shaping the Future

The United States construction industry’s business was significantly impacted during the mid-2000s economic recession, with the after effects of lost jobs, profit and people lasting for more than a decade. The last year and a half has seen the industry impacted again by the COVID-19 pandemic. But unlike the mid- to late-2000s, the overall outlook for a construction industry rebound is much brighter — and positive signs are already on full display.

During the May 18 Connected Construction at Work virtual event, Dodge Data & Analytics and Viewpoint teamed up to give attendees a look at the construction landscape. Though a number of challenges remain, a common theme is that many of today’s contractors are better prepared to weather business disruptions thanks to leading, connected construction technologies and forward-thinking strategies.

Steve Jones, senior director of industry insights and research for Dodge Data & Analytics, noted that while total project starts dropped by 9% in 2020 due to the pandemic, it was still just a blip when compared with the dropoffs experienced during the mid- to late-2000s recession (13% in 2008 and 24% in 2009). Jones said Dodge Data & Analytics is forecasting a 4% bump in 2021 and an 8% bump in 2022.

Some other highlights:

• Though U.S commercial building starts dropped 24% in 2020, forecasts project a 6% jump in 2021 and a 10% increase for 2022.
• Thanks to the popularity of e-commerce, warehouse building starts were up 6% in 2020 and will continue to grow in 2021 (8% forecasted growth and 2022 (7% forecasted growth) - led by an $8.8 billion investment by Amazon.
• Office building starts, down 22% in 2020, are expected to rebound by 8% this year and another 10% in 2022, led by a 40% bump in data center construction in 2021.
• Despite a 12% decline in nonbuilding starts (largely heavy highway and civil construction) in 2020, those project starts are expected to increase by 5% in 2021 and an additional 6% in 2022 — even without the potential for significant infrastructure spending as part of the American Jobs Plan.

Viewpoint’s Anne Hunt, director of data science, also showcased some recent trends pulled from Viewpoint’s latest Quarterly Construction Metrics Index report (focused on the first quarter of 2021) during the virtual Connected Construction at Work event. The data, fully anonymized and aggregated from more than 1,000 Viewpoint construction technology users, corroborates a lot of the positive trend lines Dodge Data & Analytics is seeing. For instance:

• Though project backlogs — a key indicator of contractors’ business health — were down in 2020, they are showing a rebound in 2021, with more than 26,000 projects backlogged in Q1 2021 among Viewpoint solution users.
• Heavy highway saw a 10% increase in pending projects in March 2021 as compared to the year before, potentially signaling a rebound for the vertical
• Backlogs for general contractors have largely been holding strong, though there are still about 10% fewer pending projects in Q1 2021 as compared to Q1 2020
• Specialty contractors had 25-30% less pending jobs in January and February of 2021 as compared to the same time period in 2020
• Contract values have largely been holding steady since October 2020, which relates to backlogs starting to build back out
• Net hiring has been positive in Q1 2021, though hiring is still down more than 40% from what it was a year ago; some regional areas though are showing a hiring boom, with contractors in the Southeast leading the way with a 103% increase in new hires.

Watch Hunt deliver her full presentation below:

Technology has played a significant role in why contractors are able to adapt to business disruptions much better today than in the mid-2000s. Jon Fingland, Trimble’s category general manager for project management and operations, highlighted how technology is going to further shape the future for construction professionals.

Fingland spoke of Trimble’s connected construction vision, tying together modern technologies and real-time data to help contractors more efficiently “plan, do and manage” their operations.

“There is still a lot of disconnection in construction today and a lot of areas that are inefficient,” Fingland said. “What we do at Trimble is connecting construction planning, doing and managing through improved workflows and accurate data. We’re one company that can bring these siloes together.”

Fingland cited a number of client examples showing the benefits of connected construction solutions and the real-world results they bring to the table. Watch Fingland’s full discussion below:

One of those connected construction success stories was also explored in more detail, as Christos Ruci, vice president of technology at Limbach — a commercial HVAC contractor — shared his company’s story of moving to the cloud and realizing the benefits of connected construction solutions.

Limbach has been a Viewpoint client since 2012. Though Ruci has only been with the company for six months, he was handed the hefty task of overhauling Limbach’s technology stack. It started with a search for more streamlined project management software and led to moving his company to the cloud with Viewpoint.

Limbach now uses Trimble’s Project Site and is moving to the cloud-based, connected ViewpointOne suite for its ERP solution. “Connected construction data — that’s where the industry is going,” Ruci said. “It’s no longer just a ‘nice to have,’ it’s a ‘need to do’ — especially now that a lot more projects are being managed remotely.”

Watch the full interview with Ruci below: