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As the world faces new challenges presented by the COVID-19 pandemic, construction contractors continue to struggle with a number of old challenges within the industry. According to the quarterly report published by the United States Chamber of Commerce (Chamber), the commercial construction industry’s biggest obstacles are the challenges created by the COVID-19 pandemic. However, challenges such as a lack of skilled workers and sunk costs associated with delays continue to impact the industry in a material way.
According to the Chamber’s second-quarter report for 2020, nearly 90% of contractors surveyed expressed, at minimum, a moderate level of concern as it relates to hiring seasoned workers who possess the appropriate skill level. Interestingly enough, with unemployment currently in the double digits, this percentage remains remarkably unchanged from pre-pandemic months. Furthermore, hiring expectations have declined to compensate for the lost sources of revenue anticipated from the pandemic. In addition to the skilled labor shortage, over 85% of contractors report experiencing some type of delay in construction within the last three to four months. With global supply chains being continually uprooted due to the virus, and contractors bearing much of the cost, the effects of delays in construction pose a significant risk to contractors.
One possible solution to the challenges presented is the growing acceptance and utilization of prefabrication and modular construction. As major advances continue to be made in the prefabrication and modular construction process, more contractors are seeing these processes as viable options. These methods, coupled with advances in Building Information Modeling (BIM), which gives the tools and technology needed to more accurately plan for and execute projects, present opportunities to address the challenges noted above. According to Dodge Data & Analytics (Dodge), the leading provider of commercial construction data, prefabrication and modular construction has continually shown that outsourcing certain elements of construction to more skilled contractors, can lessen the impact of labor shortages. Additionally, Dodge found in its survey that approximately 90% of respondents who utilize prefabrication or modular construction saw, at minimum, a moderate level of increased productivity and quality. When mated with BIM, these projects can realize savings due to improved budget and schedule performance. This often means that delays can be avoided and profitability can be increased.
Prefabrication and modular construction may not be the answer to all the challenges that the construction industry faces: however, it certainly can help contractors continue to grow and remain profitable. The incorporation of these methods and the appropriate use of technology may lead to more profitable contracts, safer job sites and higher-quality products.