The labor and material shortages occurring in today’s construction market and limited available financial resources make the market extremely competitive. It can be difficult to stand out and get the jobs you want as a subcontracting firm.
If you’re looking for more guidance on setting your business apart, join our webinar, Strategies to grow your business in a competitive market, on May 10 at 9 AM PT / 12 PM ET. Our host, Barbara L. Garrett, LEED AP, brings over 39 years of experience in construction management and project management to help construction teams of all types and sizes to adopt best-in-class construction strategies in a variety of different market conditions. Attend to gain expert insight on how you can differentiate your business in a hypercompetitive market.
Bidding Growth Following Recovery
Since 2020, bidding has grown and reached an all-time high, with 19% more new projects published year over year. This has created challenges as construction has become more competitive.
2021 was a record year in terms of growth for the construction industry. March 2021 hit an all-time high for the most new projects to be published within a month. This recovery is positive, but there are some drawbacks. With labor shortages, high costs associated with getting building materials, and other problems, subcontracting firms have to focus on setting themselves apart and setting themselves up for success.
Competition Is Increasing in the Sector
Labor shortages are one of the main reasons construction is so much more competitive. According to McKinsey & Company, US construction projects are projected to become more short-staffed in the future. The industry may be set for a jobs boom primarily created by the US Bipartisan Infrastructure Law.
McKinsey & Company projects that there could be as many as 3.2 million new jobs in nonresidential construction due to the law, requiring up to 600,000 new workers to enter the sector annually to keep up with demand.
Unfortunately, the industry is already struggling to find enough workers. The shortages aren’t surprising: the 2020 Construction Outlook Survey completed a year earlier already showed that 81% of firms were having difficulty filling hourly craft and salaried positions. At that time, 72% of firms expected labor shortages to become the most significant hurdle of the following year.
Construction still shows promise and the opportunity for growth but adapting to the skilled labor shortage is essential. Using cutting-edge technology is one option for addressing the labor shortage and making the most of your current workforce.
The Rising Cost of Construction
The rising cost of construction is another big problem for construction firms in 2022. Even with the right number of workers and the funding for supplies, supply shortages affect everyone. Building material companies have set price increases expected for at least the next 12 months through 2022. Furthermore, inflation has been significantly higher than usual, impacting construction costs and making them grow beyond the norm.
Fortunately, there are options to reduce labor and material costs in the building envelope. Tweaking designs to use fewer materials, for example, and using technology to come up with inventive solutions can help. Minimizing waste while optimizing design, manufacturing in controlled environments, and using improved technology all have the potential to help offset the rise in material costs.
Join our webinar to explore these phenomena over the following three topics
- Making data-driven bidding decisions
- Investing in the Right GC and Financial Partners
- Executing Jobs Reliably and Consistently for Continued Success
Register now to secure your spot. If you can’t make the live webinar, register anyway to receive a recording afterward.