Construction Industry Outlook for 2022
Construction industry outlook for 2022 : Across the globe, city skylines are cluttered with cranes, and the streets are filled with the sounds of construction. Everywhere you look, buildings are going up, and demand to fill them remains high.
Construction Industry Outlook for 2022
Despite the apparently booming nature of the construction industry in 2022, few experts predict smooth sailing in the months ahead. Even though demand is at an all-time high, builders are struggling to fulfill orders and deliver projects on time.
While it sounds like doom and gloom, the truth is these challenges are expected to be short lived. Most industry analysts expect construction businesses to be firing on all cylinders by the beginning of 2024, if not sooner.
With this in mind, let’s take a look at several construction industry trends expected to continue through 2022 and into next year:
The ongoing labor shortage – also known as the Great Resignation – affects all industries. Construction is no exception. From concrete pourers to steel workers and everything in between, builders are struggling to find enough folks to fill the jobsite. As we move away from the worst days of the pandemic, many analysts expect people to return to work, but only if the jobs don’t seem to suck the life out of them for little in return. Construction companies will need to rethink benefits packages, pay, and scheduling in order to hire labor at the rate required to keep pace with demand for new buildings.
While labor is the lifeblood of any construction project, the brains belong to a small group of highly specialized professionals. These include architects, engineers, and urban planners. The problem is there aren’t enough people graduating from architecture schools to replace the number of architects expected to retire within the next five years. The same can be said for engineers and urban planners. As more and more skilled professionals leave the field without an adequate number to take their place, construction companies have no choice but to put more work on the shoulders of fewer men and women. While it’s a functional short-term solution, the resulting burnout rate will only make the problem worse unless further measures are taken.
Supply chain problems have been an ongoing headache since the start of the pandemic. While consumers see it in the form of limited supplies of the latest electronics, industries see it as a blow to their ability to do business as usual. As an industry utterly dependent on hardware, construction continues to struggle with a lingering supply shortage. It’s enough of a problem for major jobsites to grind to a halt, which drives up costs and reduces profit for companies already used to working with razor thin profit margins.
Limited supply means increased prices for the existing materials available for purchase. It’s a tale as old as time. Unfortunately, these higher construction costs put added pressure on construction companies pushed to the brink thanks to labor shortages and a dwindling talent pool at the top. The light at the end of the tunnel is knowing costs will come down when supply exceeds demand. It’s just a question of when that will happen.
As mentioned at the start, the forecast for the construction industry isn’t entirely gloomy. Most experts anticipate a rapid integration of state-of-the-art construction technology. What’s more, some see it as a way to lure young people into the industry. The application of new technology – including robotics and artificial intelligence – will not only reduce the burden on companies to find workers, but help bolster the rate of people interested in working the jobs that can’t be replaced by tech.
No end in sight
No matter how bad things seem to get, those in the construction industry can rest easy knowing there will always be demand for their trade. After all, civilization can’t achieve much without the use of buildings. With this in mind, the agonies of recent months must be put in perspective. It all boils down to the unprecedented demand for construction. That’s a pretty good problem to have, from a business point-of-view.
Every year, cities across the globe see new buildings added to their skylines. Meanwhile, many floors below, the ground is abuzz with the construction of low-rise office space and affordable housing. Whether it’s 1922, 2022, 2032, or 2122, the construction industry is always humming along to the tune of human progress.
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