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Will 2018 Meet Expectations?

Will 2018 Meet Expectations?

By Greg Sitek

The future of the U.S. is shrouded in confusion, hostility, distrust, threats, uncertainty, criticism, discord, disasters, failing infrastructure, and an almost endless list of problems. But even so, we are experiencing a growing economy high employment rates, low inflation rates, strong housing market and an equally long list of positive things.

The U.S. ended 2017 with having a string of hurricanes – Harvey, Irma, Jose, and Maria – that caused around $200 Billion dollars in damages only to be followed by a season of fires that destroyed thousands of homes, building, thousands of acres of forests and intensified the stress on an exhausted infrastructure.

Thanks to the thousands of people who have and continue to pitch in with physical help, equipment, materials and supplies hurricane recovery and rebuilding is underway but will take years to accomplish. Groups like Team Rubicon and other veteran organizations along with donations of money and equipment by manufacturers, trade association, dealers, individuals and so many others have made it possible to push ahead with what is an overwhelming task. Healing is always a slow process.

In addition to the tests thrown at us by Mother Nature, we have had a cascade of political and social speed bumps adding hazards as we travel our road into the future slowing the forward momentum and intensifying the risk.

We know what 2017 was like. What can we expect for 2018 and beyond?

Economic forecasting is always tricky and unlike weather forecasting more critically important, especially for the forecaster. We’ve all heard the comment, “Being a weather forecaster is the only job where you can be wrong most of the time and not get fired.” This doesn’t apply to the economists who look at the conditions that are, that were and that will be.

Predictions for 2018 tend to be positive with most economists confident that we will sustain continued and improved national economic growth. I haven’t heard any of them forecasting a recession in the immediate future – the next six months and beyond.

We have included construction industry forecast from leading resources: Wells Fargo Economics Group, American Road & Transportation Builders Association (ARTBA) and Associated Builders & Contractors (ABC). There are many others who do an excellent job of industry forecasting.

On that I wish we could have included but didn’t have room is:

Dodge Data & Analytics (https://www.construction.com/) recently released its 2018 Dodge Construction Outlook, a mainstay in construction industry forecasting and business planning. The report predicts that total U.S. construction starts for 2018 will climb 3% to $765 billion.

“The U.S. construction industry has moved into a mature stage of expansion,” stated Robert Murray, chief economist for Dodge Data & Analytics. “After rising 11% to 13% per year from 2012 through 2015, total construction starts advanced a more subdued 5% in 2016. An important question entering 2017 was whether the construction industry had the potential for further expansion. Several project types, including multifamily housing and hotels, have pulled back from their 2016 levels, but the current year has seen continued growth by single-family housing, office buildings, and warehouses. In addition, the institutional segment of the nonresidential building has been quite strong, led especially by transportation terminal projects in combination with gains for schools and healthcare facilities. As for public works, the specifics of a $1 trillion infrastructure program by the Trump Administration have yet to materialize, so activity continues to hover around basically the plateau for construction starts reached a couple of years ago. Total construction starts in 2017 are estimated to climb 4% to $746 billion.”

“For 2018, there are several positive factors which suggest that the construction expansion has further room to proceed,” Murray continued. “The U.S. economy next year is anticipated to see moderate job growth. Long-term interest rates may see some upward movement but not substantially. While market fundamentals for commercial real estate won’t be quite as strong as this year, funding support for construction will continue to come from state and local bond measures. Two areas of uncertainty related to whether tax reform and a federal infrastructure program get passed, with their potential to lift investment. Overall, the year 2018 is likely to show some construction project types register gains while other project types settle back, with the end result being a 3% increase for total construction starts. By major sector, gains are predicted for residential building, up 4%; and nonresidential building, up 2%; while nonbuilding construction stabilizes after two years of decline.”

Association of Equipment Manufacturers (AEM) has posted a radio link on its CONEXPO-CON/AGG New update. To hear it you can do so at:

http://www.conexpoconagg.com/visit/conexpo-con-agg-radio-podcasts/

Emerging Practice of Prevention through Design and Technology Advances Poised to Help Improve Construction Safety  Latest Dodge study reveals a new arsenal of tools to help increase construction safety onsite.

Note:  Dodge has just released its newest SmartMarketReport on Safety Management in the Construction Industry, produced in partnership with The Center for Construction Research and Training and United Rentals. The study reveals the engagement with and impact of two critical trends for improving construction safety: technologies used on job sites and the practice of Prevention through Design (PtD).

A new study  reveals the engagement with and impact of two critical trends for improving construction safety—technologies used on jobsites, and the practice of Prevention through Design (PtD). The study, conducted in partnership with the Center for Construction Research and Training (CPWR) and United Rentals and published in the Safety Management in the Construction Industry 2017 SmartMarket Report, is the third in a series of studies that demonstrate the financial and project benefits that contractors reap from their safety investments. It also shows the impact that new technologies being deployed onsite, from building information modeling (BIM) to drones to wearable devices, have on improving safety. Finally, it suggests that active consideration of safety during building design, known formally as Prevention through Design (PtD) is still an emerging practice, but one well-positioned for wider acceptance in the design and construction industry. The full report is available for free download here.

The findings from the study on the benefits of safety investments, along with previous studies conducted in 2012 and 2015, show that investment in safety has a positive impact on project budgets, schedules, quality, and on business factors such as a contractor’s standing in the industry or ability to contract new work. And these impacts can be substantial: contractors reporting positive impacts on average see a nearly 5 percent reduction in the project schedule and a 4 percent reduction in project costs.

“Consistently, contractors have reported that they receive project and business benefits from safety, even across dramatically different construction markets, such as the ones in 2012 and 2017,” says Steve Jones, senior director, industry insights research at Dodge Data & Analytics. “Safety investments clearly pay off in measurable ways and in ways that are harder to quantify, but that still have a major impact on a contractor’s business.”

The study followed up on the 2012 and 2015 findings on leading indicators of a positive safety culture and climate on job sites. For instance, safety & health training for supervisors and workers, one of the eight indicators, is up from 2015, while recognizing the importance of good communication, another of the indicators, is down.  “This survey helps us track what is happening in the industry relative to each leading indicator.  These findings are extremely useful in identifying needs and opportunities for improvement,” says Chris Cain, executive director, CPWR.

The study examined the degree to which contractors are deploying technologies that can help improve job site safety, a concept that was also examined in 2012. Different technologies were explored, including BIM, mobile tools and emerging technologies like drones and wearable devices. The findings reveal the ways in which technology is already helping to improve safety and how it is likely to do so in the future.  

  • Over two-thirds of contractors who use BIM (69 percent) state that it has a positive impact on project safety, a 27-point increase over those who reported that in 2012.
  • Over half of those reporting that positive impact attributes it to using BIM to identify potential site hazards before construction begins, to conduct clash detection, to support prefabrication and to create 3D images.
  • Smartphone use is nearly ubiquitous onsite, and tablet use is widespread and growing. This allows for use of mobile tools like cameras to be used by 85 percent of all contractors on site. The documentation of site condition and work progress is fundamental to many safety efforts.
  • Nearly half of contractors (42 percent) also employ safety inspection checklist apps, but the use of mobile tools for safety training (35 percent) and to access safety and health websites (28 percent) is less common.
  • Almost one-quarter of contractors (21 percent) use drones to promote safety onsite for functions such as reality capture that allow for digital analysis of existing conditions, and almost three-quarters of them (70 percent) believe that these have a positive impact on safety.
  • While wearable devices like badges with coded electronic information and smart helmets are only being used by 13 percent of contractors currently, 82 percent of those who use them report a positive impact on safety. This suggests that as these technologies become more widely known and more affordable, their potential for improving job site safety increases. 

“Technology is drastically improving job site safety, providing tangible results in protecting workers and firms alike,” says Jim Dorris, United Rentals’ vice president of environmental, health and safety. “Evolving data platforms, tools, and service capabilities will deliver innovative new safety solutions, and United Rentals is excited about the emerging roadmap to safer projects of all types.”

Another emerging trend explored in the study is PtD: the effort to help improve construction safety by actively considering safety issues during design, from the schematic stage forward. The study included an architect survey on this issue, which found that while few architects were aware of the formal name for this process before taking the survey, the use of key PtD practices occurred at least to some degree.

  • Most architects (83 percent) report that they have worked with GCs and key trades before the completion of schematic design to identify opportunities for prefabrication.
  • Roughly two-thirds are either reviewing the design during schematic for safety during building operations/maintenance (68 percent) or use a lifecycle safety approach to improve safety during building operations (66 percent).
  • However, only about half of architects (51 percent) do similar reviews to optimize construction safety.

The biggest barrier to wider use of PtD among architects is concern about taking on construction liability, reported by 79 percent, followed by lack of client interest at 63 percent. Correspondingly, most architects (81 percent) would be influenced by requests from their clients to take this approach, and over two thirds (68 percent) would be influenced by insurance incentives. With global studies linking between 22 percent and 63 percent of workplace fatalities to design-related factors, getting owners on board with demanding this approach, providing liability coverage for architects seeking to practice it and getting insurance companies to reward them appear to be powerful ways to enhance the safety records of buildings.

“The survey findings confirm two things we have been hearing for years,” says Cain. “Owners drive construction safety and health, and architects are reluctant to implement PtD solutions without client pressure. By ensuring the entire team, starting with the owner/client, focuses on preventing job site hazards, we will continue to see improvements in worker injuries, illnesses, and fatality rates.”

About Dodge Data & Analytics: Dodge Data & Analytics is North America’s leading provider of analytics and software-based workflow integration solutions for the construction industry. Building product manufacturers, architects, engineers, contractors, and service providers leverage Dodge to identify and pursue unseen growth opportunities and execute those opportunities for enhanced business performance. Whether it’s on a local, regional or national level, we make the hidden obvious, empowering our clients to better understand their markets, uncover key relationships, size growth opportunities, and pursue those opportunities with success. Our construction project information is the most comprehensive and verified in the industry. We are leveraging our 100-year-old legacy of continuous innovation to help the industry meet the building challenges of the future. To learn more, visit www.construction.com.

About CPWR: The Center for Construction Research and Training [CPWR] is a nonprofit organization dedicated to reducing injuries, illnesses, and fatalities in the construction industry through research, training, and service programs, and currently serves as the National Institute for Occupational Safety and Health’s (NIOSH) National Construction Center and the research and training arm of NABTU.  In this capacity, CPWR works to reduce or eliminate occupational safety and health hazards faced by construction workers through safety and health research and the development of a broad array of training programs. For more information please go to www.cpwr.com.

 About United Rentals: United Rentals, Inc. is the largest equipment rental company in the world. The company has an integrated network of 1,019 rental locations in 49 states and every Canadian province. The company’s approximately 15,000 employees serve construction and industrial customers, utilities, municipalities, homeowners, and others. The company offers approximately 3,300 classes of equipment for rent with a total original cost of $11.6 billion. United Rentals is a member of the Standard & Poor’s 500 Index, the Barron’s 400 Index and the Russell 3000 Index® and is headquartered in Stamford, Conn. Additional information about United Rentals is available at www.unitedrentals.com.

 

Dodge Momentum Index Stumbles in July

The Dodge Momentum Index fell in July, dropping 3.3% to 135.0 (2000=100) from its revised June reading of 139.6. The Momentum Index is a monthly measure of the first (or initial) report for  in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The move lower in July was due to a 6.6% decline in the institutional component of the Momentum Index, while the commercial component fell 1.1%. This month continues a recent trend of volatility in the Momentum Index where a string of gains is interrupted by a step backwards in planning intentions. Despite the decline from June to July, the Momentum Index is 6.9% higher than one year ago, which suggests further moderate gains in construction activity throughout the year. The commercial component of the Momentum Index is 8.0% higher than last year, while the Institutional component is 5.3% higher.

In July, nine projects entered planning each with a value of $100 million or more. For the institutional building sector, the leading projects were the $200 million Kaiser Permanente Medical Center in Woodbridge VA and the $200 million phase 2B of the Thompson Education Center in Rocky Hill NY. The leading commercial building projects were a $177 million Amazon fulfillment center in North Randall OH and the $170 million Pala Casino and Resort in Pala CA.

nonresidential building projects About Dodge Data & Analytics: Dodge Data & Analytics is North America’s leading provider of analytics and software-based workflow integration solutions for the construction industry. Building product manufacturers, architects, engineers, contractors, and service providers leverage Dodge to identify and pursue unseen growth opportunities and execute on those opportunities for enhanced business performance. Whether it’s on a local, regional or national level, Dodge makes the hidden obvious, empowering its clients to better understand their markets, uncover key relationships, size growth opportunities, and pursue those opportunities with success. The company’s construction project information is the most comprehensive and verified in the industry. Dodge is leveraging its 100-year-old legacy of continuous innovation to help the industry meet the building challenges of the future.  To learn more, visit www.construction.com.

Dodge Data & Analytics and Dexter + Chaney Partner to Streamline Document and Bid Management Workflows for Construction Professionals

Dexter + Chaney is a strategic reseller of Dodge PlanRoom 2017, bringing greater efficiency, collaboration to construction projects

 At Dexter + Chaney’s annual Connect 2017 User Conference in Seattle this week, Dodge Data & Analytics and Dexter + Chaney, a leading provider of construction management software, announced that they will promote and provide Dodge PlanRoom 2017 to Dexter + Chaney subscribers. Dodge PlanRoom 2017 is a simple, secure service for contractors and subcontractors to connect and share project information and manage their bidding process in a convenient, online location.

Through this strategic reseller agreement, Dodge PlanRoom 2017 will be integrated with Dexter + Chaney’s Spectrum® Construction ERP (Enterprise Resource Planning) Software this year, facilitating streamlined workflow from pre-construction through closeout.

“We are excited to be working with Dexter + Chaney to combine Dodge tools and intelligence with their world-class construction management software,” said Mike Petrullo, Chief Executive Officer, Dodge Data & Analytics. “This is another important step in realizing our vision of creating a cloud-based hub to revolutionize workflow management and connect projects, people, and products in the construction community.”

Dodge Data & Analytics provides comprehensive information and intelligence on the commercial construction industry to customers at every step in the design and build process. Dexter + Chaney’s Spectrum software provides contractors with a comprehensive platform for business and project management across all stages of the project lifecycle.

“Working with Dodge to offer Spectrum PlanRoom powered by Dodge allows us to deliver a new level of seamless integration and workflow optimization to our clients,” said Dexter + Chaney President and CEO Norbert Orth. “We are excited to be, alongside Dodge, at the forefront of a major shift in the way the construction industry does business.”

About Dodge Data & Analytics: Dodge Data & Analytics is North America’s leading provider of analytics and software-based workflow integration solutions for the construction industry. Building product manufacturers, architects, engineers, contractors, and service providers leverage Dodge to identify and pursue unseen growth opportunities and execute on those opportunities for enhanced business performance. Whether it’s on a local, regional or national level, Dodge makes the hidden obvious, empowering its clients to better understand their markets, uncover key relationships, size growth opportunities, and pursue those opportunities with success. The company’s construction project information is the most comprehensive and verified in the industry. Dodge is leveraging its 100-year-old legacy of continuous innovation to help the industry meet the building challenges of the future.  To learn more, visit www.construction.com.

About Dexter + Chaney: Dexter + Chaney has been providing complete construction management software for more than 36 years. From the office to the field, from accounting to project management, Dexter + Chaney software is used by more than 1,000 companies. Their clients come from all segments of the industry—heavy/highway and utility, general contractors, electrical, mechanical, and specialty subcontractors—and are companies of all sizes, from locally owned subcontractors to some of the world’s largest construction firms. Dexter + Chaney’s web-based software applications allow customers to get work done anywhere using any device with a web browser and without the need to download any software. For more information about Dexter + Chaney’s products and services, visit: www.dexterchaney.com.