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Deepening labor struggle & future of construction

Deepening labor struggle & future of construction

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Home Vendor News Deepening labor struggle & future of construction

The construction labor shortage continues to deepen nationally, evident by a historically low unemployment rate of 4.5 percent. There has been minimal growth in the workforce over the last nine months, with no sign of an increase. Because of this, industry professionals can expect project timelines to be extended, wages to increase at a faster rate and all eyes focused on construction technology to offset these challenges.
Despite this, the industry continued to hit a mature stage of economic expansion in the third quarter, according to a new report from JLL that tracks national construction trends. Construction spending was up 1.9 percent over 2016 levels and contractor and subcontractor work was also up 1.4 percent year-over-year.
“The construction industry remains strong, but the volume of incoming workers has come close to a halt,” said Todd Burns, President, JLL Project and Development Services. “There are new technologies within reach that will improve productivity, enhance worker safety and create higher quality buildings for the future.”
Construction technology, a bright spot for the industry:
A variety of new construction technologies have emerged over the last two years, but adoption has been low. However, there are substantial innovative changes that could have a profound impact to efficiency and productivity in 2018 and further into the future.
1. Building Information Modeling (BIM): BIM is the facilitator and enabler for which many technologies are based. 3D printing, cloud based collaboration, robotics and artificial intelligence all stem from a central BIM platform. Companies like AutoDesk and GRAPHISOFT both have products that offer innovative uses of BIM.
2. Artificial intelligence (AI) and big data: Gathering, storing and analyzing large sets of data has become increasingly easier and cheaper over the last several years. Big data and AI is already being used to drive autonomous equipment, track and optimize worker positioning and schedule materials delivery – all working towards more efficient and timely job sites.
3. Prefabrication and offsite construction: General contractors are turning to prefabrication and offsite construction facilities that allow them to create building product with semi-skilled labor in a weather controlled, safe manufacturing atmosphere. Prefabrication facilities now have the capabilities to tackle everything from individual walls, to fully built bathrooms and offices offsite.
What does the future hold for the construction industry?:
As a whole, the U.S. economy has seen consistently strong growth over the past eight years, demonstrating that commercial real estate does not require rapid economic growth to perform well. If the economy continues to follow its current trajectory, growth will continue for the next 12-18 months.
Although topline construction spending is still increasing, consecutive quarters over past years show smaller and smaller gains, pointing to a tapering growth curve. And while the volume of new ground breaks for large scale private projects have begun to scale back due to the long-term nature of the timelines, renovation and fit-out work demonstrate continued strength, which will prevail into the next several quarters and beyond.
“Lenders are seeing less interest in large scale development loans as developers begin to look more cautiously at the future,”said Mason Mularoni, Senior Research Analyst, JLL Project and Development Services. “Available prime development sites across major U.S. cities also continue to decline, which has developers setting their sights on adaptive reuse and innovative renovation projects, which they can bring to the market quicker with less upfront capital spend.”
JLL Project and Development Services is a leader in the development, design, construction and branding of commercial real estate projects for the world’s most prominent corporations, educational institutions, public jurisdictions, healthcare organizations, industrial facilities, retailers, hotels, sports facilities and real estate owners.
Ranked No. 4 in Building Design + Construction’s 2017 Construction Management Giants survey and No. 5 on Engineering News-Record’s 2017 list of Top 100 Construction Management-for-Fee Firms, JLL’s project management team comprises 5,420 project managers across 51 countries and is actively managing $35.7 billion under construction.
About JLL
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. A Fortune 500 company, JLL helps real estate owners, occupiers and investors achieve their business ambitions. In 2016, JLL had revenue of $6.8 billion and fee revenue of $5.8 billion and, on behalf of clients, managed 4.4 billion square feet, or 409 million square meters, and completed sales acquisitions and finance transactions of approximately $145 billion. At the end of the third quarter of 2017, JLL had nearly 300 corporate offices, operations in over 80 countries and a global workforce of over 80,000. As of September 30, 2017, LaSalle Investment Management had $59.0 billion of real estate under asset management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit


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