{"id":13164,"date":"2023-02-14T23:47:16","date_gmt":"2023-02-15T07:47:16","guid":{"rendered":"https:\/\/essential.construction\/news\/labor-shortages-inflation-vex-civil-contractors-but-optimism-remains\/"},"modified":"2023-02-14T23:47:16","modified_gmt":"2023-02-15T07:47:16","slug":"labor-shortages-inflation-vex-civil-contractors-but-optimism-remains","status":"publish","type":"post","link":"https:\/\/essential.construction\/news\/labor-shortages-inflation-vex-civil-contractors-but-optimism-remains\/","title":{"rendered":"Labor shortages, inflation vex civil contractors, but optimism remains"},"content":{"rendered":"

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Federal infrastructure funding is rolling out more slowly than expected, inflation is cutting into public works budgets and skilled labor shortages are resulting in lost work \u2014 nonetheless, civil contractors and engineers are positive about the industry\u2019s outlook, Dodge Construction Network\u2019s <\/span><\/span><\/span><\/span><\/span><\/span>Civil Quarterly 2023 Issue 1 report<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/a> found.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

The data and analytics firm also dug into BIM trends and surveyed its audience about something new in this issue: mental health. Here are some highlights from the report.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Labor shortages mean work turned down, but optimism is up<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n

Finding skilled workers is a persisting problem in construction, and per a new analysis by Associated Builders and Contractors, looks set to worsen as a large <\/span><\/span><\/span><\/span><\/span><\/span>swath of workers reach retirement age<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/a>. The Dodge report goes into this problem in more detail. Of civil contractors surveyed, 72% said they struggled to hire skilled workers; since the second quarter of 2021, that number has hovered around 70%.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Labor gaps are affecting project timelines as well as how much work contractors and engineers can take on: 58% of civil contractors said they are turning down work due to a shortage of skilled workers, up from 50% in the fourth quarter of 2021. This labor shortage may \u201cimpact the degree to which the U.S. can fully capitalize on the extra infrastructure funding that has been allotted,\u201d according to the report.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

As workarounds, companies are asking workers to do more, putting in higher bids, and\/or letting schedules run long, according to Donna Laquidara-Carr, industry insights research director at Dodge Data & Analytics.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

\u201cBut is it going to choke the pipeline? I think contractors are too committed to getting work done to see that happen,\u201d said Laquidara-Carr.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

She is buoyed by the fact that, despite rumblings of a recession, of civil contractors surveyed, 26% expect a significant increase in revenue, and 14% expect a significant increase in profit margins within the next 12 months. That\u2019s more optimistic than the third quarter of 2022, where those numbers stood at 20% and 11%, respectively.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

BIM and digital twins gain popularity<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n

Construction is notoriously slow to adopt tech, but the use of BIM and digital twins is growing. Dodge found that 78% of civil engineers use BIM, up from 66% in 2020. Those percentages are lower among civil contractors: 60% don\u2019t use BIM at all.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Usage rate also depends on the size of the civil contractor, with 63% of large contractors using BIM, 41% of midsize contractors and 14% of small contractors. For small contractors, BIM use actually declined from 20% in 2020.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

BIM is still not commonly used on infrastructure projects, according to the report, even though it has the potential to transform civil work. Dodge found that most civil contractors and engineers have had owners request BIM models, even if it\u2019s not a common experience. Only 6% of contractors and 13% of engineers reported that this happens on more than half their projects.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Interest in digital twins is increasing and driving owner requests, said Laquidara-Carr. Digital twins, representations of a physical asset or system which enables virtual interaction, can be used not only in the construction process but also by owners for operations and maintenance after project completion.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

\u201cContractors are very driven by what their owners are looking for,\u201d she said. Right now, going from BIM to digital twin is nice to have, but \u201cif this takes off with owners, they are going to be expecting digital delivery.\u201d\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

New focus on mental health<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n

For the first time, Dodge Construction did a deep dive into mental health in the civil engineering and contractor world \u2014 a problem that <\/span><\/span><\/span><\/span><\/span><\/span>disproportionately impacts the industry<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/a>. Because of the pandemic, construction has become more willing to discuss and address suicide, addiction and other mental health challenges, according to Laquidara-Carr.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n