Experts are already prognosticating about what 2019 will look like for industry professionals and consumers. Here, The Progressive Builder will look back on 2018 and review some of the industry’s milestones, for better or worse, as builders, buyers and experts prepare for a new chapter come January.
President Trump Begins 2018 Boldly
- During President Donald Trump’s State of the Union address, he called for Americans to recall a time of hard work and craftsmanship that helped create the economic powerhouse the U.S. ultimately became.
- Trump called for Congress to approve $1.5 trillion in infrastructure spending, much to the satisfaction of large trade organizations.
- Key Quote: “Together, we can reclaim our building heritage. We will build gleaming new roads, bridges, highways, railways, and waterways across our land. And we will do it with American heart, American hands, and American grit,” said Trump, in his address.
- Early in the year, the U.S. and South Korean came to an agreement to exempt the Asian country from newly announced steel tariffs.
- Metallic import tariffs, though, raised some alarms with Associated General Contractors of America. Stephen Sandherr said he worried the new tax could harm the job market by raising materials costs
- Key Quote: “These new tariffs will cause significant harm to the nation’s construction industry, put tens of thousands of high-paying construction jobs at risk, undermine the President’s proposed infrastructure initiative and potentially dampen demand for new construction projects for years to come,” said Sandherr.
Economy Defined By Widespread Despite Labor Shortages
- Seasonally adjusted housing starts in dropped 3.7% from March to April, but remained well over 2017’s April rates by a 10% margin, according to the United States Census Bureau.
- In May, a high demand for skilled workers led the way for a 1% dip in the national construction unemployment rate, according to the U.S. Bureau of Labor Statistics.
- June brought a dip in construction spending for the housing industry, but unemployment continued to shrink.
- Key Quote: The shortage of human capital is long-lived, and the recent pace of construction hiring has been rapid. A more likely explanation is that the recent surge in construction materials prices is resulting in material acquisition delays,” said ABC Chief Economist Anirban Basu.
- A survey from September from the American General Contractors found 80% of respondents reported difficulty finding workers to fill hourly “craft workers positions,” with 44% noting the cost of projects are “higher than anticipated.” Labor shortages continued to hamper the industry.
- In most of the U.S., construction industry unemployment rates in October were down year-over-year, according to the U.S. Bureau of Labor Statistics (an analysis from the Associated Builders and Contractors showed 45 states saw improvements in the unemployment rate).
- Key Quote: “Construction activity and hiring of construction workers continued to be healthy in most of the nation,” said Bernard M. Markstein, president and chief economist of Markstein Advisors, which was responsible for putting together the ABC analysis.
Safety, Innovation and Collaboration Set Tone for Future
- The demand for construction robots is expected to spike by 2023. A report from Market and Markets showed the construction robot market is expected to reach a compound annual growth rate of 16.8%. The increase in demand for the construction robots will come as companies look to improve the safety and quality of their work.
- A new partnership between Associated Builders and Contractors and access equipment manufacturer JLG Industries was forged.
- The industry also saw an influx of financial investments, start-up technology firms and a commitment to develop new technologies to improve construction safety and productivity, according to an analysis from Triax Technologies.
- Key Quote: “There’s no doubt that construction workforce dynamics are changing, with experienced workers retiring and a shortage of skilled workers to fill those slots,” said Chad Hollingsworth, CEO and co-founder of Triax Technologies. “Organizations must learn to do business in new ways with less manpower, and that means leveraging technology to gain visibility across projects, attract a new generation of workers, and optimize worksite, safety and project performance.”
- Triax Technologies, The Travelers Companies, Inc. and Gilbane, also agreed to collaborate. The crux of the partnership will be Triax-developed devices worn by workers to collect data from those working at construction sites. The data will be reviewed by Travelers with the aim of identifying ways to improve construction site safety.