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Commercial Construction Index Reveals Continued Optimism Among Contractors

Commercial Construction Index Reveals Continued Optimism Among Contractors 

Q4 Report Shows Increased Hiring Expectations Despite Finding Labor Productivity the No. 1 Issue Impacting Jobsite Efficiency

USG Corporation released their Q4 Commercial Construction Index (CCI), on 12-11-2017. The CCI provides truly unique insights into the outlook for and confidence in the future direction of the industry, which is a vital driver of the U.S. economy. 
Confidence in the commercial construction industry is strong, despite significant concerns around job site efficiency and labor productivity, according to the Q4 2017 USG Corporation + U.S. Chamber of Commerce Commercial Construction Index (Index). Released today, the Index shows that optimism remains high in the commercial construction industry, with 57 percent of contractors expecting to hire in the next six months and a large majority reporting stable or increased revenue expectations in the next year. The Q4 composite score is 74, up one point from Q3.

The report found nearly 90 percent of contractors do not consider job sites to be very efficient. Forty-four percent of contractors identified labor productivity as the key means to achieve job site efficiency, followed by job site logistics and project management. Forty percent of contractors reported the use of prefabricated building components to be the top means of improving labor productivity.

“Commercial contractors remain optimistic about the industry outlook, although labor productivity and costs are hindering job site efficiency,” said Jennifer Scanlon, president, and CEO of USG Corporation. “There is an urgent need for innovations in building materials and workforce development programs.”

More than half of contractors expect to hire workers in the next six months, yet concerns about the cost of skilled labor and the adequacy of worker skills have remained steady throughout all four quarters of 2017. Forty-two percent of contractors predict finding skilled workers will worsen in the next six months, and 92 percent note they are at least moderately concerned about the skill level of the workforce, with heightened demand particularly in the plaster and drywall trades. The research was developed with Dodge Data & Analytics (DD&A), the leading provider of insights and data for the construction industry, by surveying commercial and institutional contractors.

“The commercial construction industry is essential to the U.S. economy – when America is building or re-building, America is growing. It’s great news that the majority of these companies are ready to hire,” said Thomas J. Donohue, president, and CEO of the U.S. Chamber. “As worker shortages persist across industries, sectors like commercial construction will have to find solutions through new innovations, technology, and training to continue growing and moving the broader U.S. economy forward.”

The Index looks at the results of three leading indicators to gauge confidence in the commercial construction industry – backlog levels, new business opportunities, and revenue forecasts – generating a composite index on a scale of 0 to 100 that serves as an indicator of health for the contractor segment on a quarterly basis. The Q4 2017 composite score was 74, up one point from Q3, representing a consistent sentiment of health in the sector.

The Q4 results from the three key drivers were:

  • Backlog: On average, contractors currently hold 9.4 months of backlog, relatively close to the average ideal amount of 12.5 months, continuing the stability of the market, although there is still room for growth. Down two points from Q3, this represents 75 percent of their ideal backlog levels.
  • New Business: Nearly all (99 percent) contractors report high or moderate confidence in the demand for commercial construction. Approximately one-third (34 percent) believe the market will continue to provide strong opportunities for the next 24 months.
  • Revenues: Nearly half (47 percent) of contractors expect to see an increase in revenue in the next year. This percentage has increased over the last two quarters from 41 percent in Q3 and 40 percent in Q2.

About the Index

The USG Corporation + U.S. Chamber of Commerce Commercial Construction Index is a quarterly economic index designed to gauge the outlook for, and resulting confidence in, the commercial construction industry. USG Corporation and the U.S. Chamber produce this Index, along with Dodge Data & Analytics (DD&A). Each quarter, researchers from DD&A source responses from their Contractor Panel of more than 2,700 commercial construction decision-makers in order to better understand their levels of confidence in the industry and other key trends. This panel allows DD&A to provide findings that are representative of the entire U.S. construction industry by geography, size, and type of company. The majority of data represented in this quarter’s Index is from the Q4 2017 survey conducted online from September 22 to October 2, 2017.

Click here to see the full report, methodology, and graphics.

Please note the Commercial Construction Index report is intended for general informational purposes only. It is not intended to support an investment decision with respect to USG Corporation, nor is it intended to be used for marketing purposes to any existing or prospective investor of USG. This report is not a forecast of future results for USG and actual results of USG may differ materially from those of the commercial construction industry.

Where the Index is Available

Each quarterly Index published is available on the USG Corporation website at www.usg.com/news as well as on the website www.CommercialConstructionIndex.com

About the U.S. Chamber of Commerce

The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations. For more information, visit www.uschamber.com.

About USG Corporation

USG Corporation is an industry-leading manufacturer of building products and innovative solutions. Headquartered in Chicago, USG serves construction markets around the world through its United States Gypsum Company and USG Interiors, LLC subsidiaries and its international subsidiaries, including its USG Boral Building Products joint venture. Its wall, ceiling, flooring, sheathing and roofing products provide the solutions that enable customers to build the outstanding spaces where people live, work and play. Its USG Boral Building Products joint venture is a leading plasterboard and ceilings producer across Asia, Australasia, and the Middle East. For additional information, visit www.usg.com.

Three Next Generation Cat® Excavators Deliver More Choices for Increased Efficiency and Lower Operating Costs in 20-Ton Size Class

Cat 320 HEX digging foundations

Three Next Generation 20-ton size class excavators from Caterpillar—the 320 GC, 320 and 323—increase operating efficiency, lower fuel and maintenance costs, and improve operator comfort compared to previous models. The new excavators offer unique combinations of purpose-built features designed to match customers’ productivity and cost targets.

Still the 20-ton class standard, the new Cat® 320 raises the bar for efficiency with integrated Cat Connect Technology that advances productivity gains. Standard technology combined with lower fuel and maintenance costs deliver low-cost production in medium- to heavy-duty applications.

Designed for low- to medium-duty applications, the new Cat 320 GC combines the right balance of productivity features with reduced fuel consumption and maintenance costs. The result is high reliability and low cost-per-hour performance.

Cat 320GC HEX working

Delivering high production performance, the new premium Cat 323 boasts standard integrated Cat Connect Technology and the most power and lift capacity in the line. These features combine with lower fuel consumption and reduced maintenance costs to deliver maximum productivity at the lowest cost.

Technology boosts efficiency by up to 45 percent                            

The new Cat 320 and 323 boast the industry’s highest level of standard factory-equipped technology to boost productivity. Both models are equipped with integrated Cat Connect Technology, which increases operating efficiency by up to 45 percent over traditional grading operations.

Offering guidance for depth, slope and horizontal distance to grade, the Cat Grade with 2D system helps operators reach the desired grade quickly and accurately. Using the system’s E-fence feature enables the machine to work safely under structures or near traffic by preventing any part of the excavator from moving outside operator-defined set points. The standard 2D system can be upgraded to Cat Grade with Advanced 2D or Cat Grade with 3D.

Standard Grade Assist automates boom, stick and bucket movements, so operators stay on grade simply and effortlessly with single-lever digging. Cat Payload on-board weighing, integrated on the Cat 320 and 323 at the factory, delivers precise load targets and increased loading efficiency with on-the-go weighing and real-time payload estimates without swinging to prevent truck over/under-loading. Cat LINK™ hardware and software connect job sites to the office and provide customers with machine-critical operating information.

Fuel savings reaching 25 percent
Durable Cat engines provide duty-matched power ratings from 121 to 162 hp (90 to 121 kW) for the three new excavators. The efficient Next Generation machines consume 20 to 25 percent less fuel than the previous, corresponding models. New Smart mode operation automatically matches engine and hydraulic power to digging conditions, optimizing both fuel consumption and performance. Engine speed is automatically lowered when there is no hydraulic demand to further reduce fuel usage.

Cat 323 HEX working

More efficient than single-fan systems, the new cooling system employs multiple electric fans, which independently monitor hydraulic oil, radiator and air-to-air aftercooler temperatures to deliver the exact airflow required. With a new hydraulic system built for responsiveness and efficiency, the Cat 320 GC, 320 and 323 feature a new main control valve that eliminates the need for pilot lines, reduces pressure losses and lowers fuel consumption. Fewer hydraulic lines on the excavators result in 20 percent less oil required, lowering long-term operating costs.

Maintenance costs reduced as much as 15 percent

Offering extended and more synchronized maintenance intervals, the new Cat excavators do more work at a lower cost and reduce maintenance costs by up to 15 percent over the previous series. Featuring higher dirt capacity, the new Cat hydraulic return filter boasts a 3,000-hour service life, a 50 percent increase over previous filters. A new Cat air filter with integrated pre-cleaner and primary and secondary filters extends service life to 1,000 hours, a 100 percent increase over previous designs, while a new fuel tank cap filter extends service life to 2,000 hours. The three fuel system filters each offer a 500-hour service interval.

All daily maintenance checks for engine oil, fuel water separator, fuel tank water and sediment, and cooling system level are performed from ground level, making the routine faster, easier and safer. Consolidated filter locations reduce service time. 

New cab designed to enhance operator performance

Cat 323 HEX setting pipe

All Next Generation Cat Excavator cabs come equipped with standard features like keyless push-button start, large standard 8” (203-mm) touchscreen monitor with jog dial keys for control and sound-suppressed rollover protective structures (ROPS) to offer the next level of operator comfort, safety, and quiet operation. Programmable joystick buttons for response and pattern allow the operator to dial in productivity settings. New advanced viscous mounts reduce cab vibration by up to 50 percent over previous models to reduce operator fatigue.

Equipped with a choice of Comfort, Deluxe or Premium cab packages, the new spacious cab features a low-profile design and large front, rear and side windows to enhance visibility to the front and side of the excavator. Optional 360-degree visibility combines images from multiple machine-mounted cameras to enhance the operator’s sight-lines in all directions. Automatic climate control maintains internal cab temperature settings, regardless of external ambient temperatures. A Bluetooth® integrated radio with USB ports for connecting and charging phones bring creature comforts from the home to the operator’s office. A tilt-up console for the Deluxe and Premium cab designs affords easy cab entry and exit.

For more information about Cat Next Generation Hydraulic Excavators, contact the local Cat dealer or go to www.cat.com

 

Cat 320, 320GC, 323 HEX

Next Generation Cat Excavators Product Specifications

                                          320 GC 320 323
Engine Cat C4.4 ACERT™ Cat C4.4 ACERT™ Cat C7.1 ACERT™
Gross Power (ISO 14396) 121 hp (90 kW) 162 hp (121 kW) 162 hp (121 kW)
Operating weight 48,300 lb
(21 900 kg)
50,100 lb
(22 700 kg)
56,200 lb
(25 500 kg)
Max. digging depth,
{18’ 8” (5.7 m) boom,
9’ 6” (2.9 m) stick}
22’ 1” (6 720 mm) 22’ 1” (6 720 mm) 22’ 1” (6 720 mm)
Max. reach at ground level
{18’ 8” (5.7 m) boom,
9’ 6” (2.9 m) stick}
32’ 4” (9 860 mm) 32’ 4” (9 860 mm) 32’ 5” (9 870 mm)
Max. loading height
{18’ 8” (5.7 m) boom,
9’ 6” (2.9 m) stick}
21’ 4” (6 490 mm) 21’ 4” (6 490 mm) 21’ 3” (6 480 mm)

Clutch Performance – C.W. Matthews Finishes Bridge Reconstruction Ahead of Schedule

AGC Special Report on Difficulties FINDING QUALIFIED CRAFT WORKERS TO HIRE AMID GROWING CONSTRUCTION DEMAND

SEVENTY-PERCENT OF CONTRACTORS HAVE A HARD TIME FINDING QUALIFIED CRAFT WORKERS TO HIRE AMID GROWING CONSTRUCTION DEMAND, NATIONAL SURVEY FINDS

Labor ShortagesChronic Labor Shortages are Changing the Way Many Firms Operate, Recruit and Compensate Workers, but Long-Term Economic Impacts Could Be Severe Without New Workforce Measures, Officials Caution

Seventy percent of construction firms report they are having a hard time filling hourly craft positions that represent the bulk of the construction workforce, according to the results of an industry-wide survey released today by Autodesk and the Associated General Contractors of America. Association officials said that many firms are changing the way they operate, recruit and compensate, but cautioned that chronic labor shortages could have significant economic impacts absent greater investments in career and technical education.

“In the short-term, fewer firms will be able to bid on construction projects if they are concerned they will not have enough workers to meet demand,” said Stephen Sandherr, chief executive officer for the Associated General Contractors.  “Over the long-term, either construction firms will find a way to do more with fewer workers or public officials will take steps to encourage more people to pursue careers in construction.”

Of the more than 1,600 survey respondents, 70 percent said they are having difficulty filling hourly craft positions, Sandherr noted. Craft worker shortages are the most severe in the West, where 75 percent of contractors are having a hard time filling those positions, followed by the Midwest where 72 percent are having a hard time finding craft workers, 70 percent in the South and 63 percent in the Northeast.

The labor shortages come as demand for construction continues to grow.  Sandherr noted that construction employment expanded in 258 out of 358 metro areas that the association tracks between July 2016 and July 2017, according to a new analysis of federal construction employment data the association also released today. Growing demand for construction workers helps explain why 67 percent of firms report it will continue to be hard, or get harder, to find hourly craft workers this year.

Tight labor market conditions are prompting firms to change the way they operate, recruit and compensate workers, Sandherr noted.  Most firms report they are making a special effort to recruit and retain veterans (79 percent); women (70 percent) and African Americans (64 percent).  Meanwhile, half of construction firms report increasing base pay rates for craft workers because of the difficulty in filling positions.  Twenty percent have improved employee benefits for craft workers and 24 percent report they are providing incentives and bonuses to attract workers.

Forty-six percent of firms also report they are doing more in-house training to cope with workforce shortages while 47 percent report they are increasing overtime hours and 41 percent are increasing their use of subcontractors.  In addition, 22 percent report they are increasing their use of labor-saving equipment, 11 percent are using off-site prefabrication and 7 percent are using virtual construction methods like Building Information Modeling, or BIM for short.

“The ongoing labor drought continues to put pressure on the already high-risk, low-margin construction industry,” said Sarah Hodges, director of the construction business line at Autodesk, a leading 3D design, engineering, and construction software firm. “As labor challenges continue to grow, technology will play an increasingly important role supporting the existing workforce while inspiring the next generation of industry professionals.”

Sandherr called on federal, state and local officials to act on the measures in the association’s Workforce Development Plan to address the growing worker shortages. In particular, he urged the Senate to pass legislation to reform and increase funding for the Perkins Career and Technical Education Act.

The survey was conducted in July and early August. Click here to see the national survey results, analysis of the data and regional and state-by-state results. Click here for the July 2017 metro construction employment data.

GOMACO GHP-2800 two-track paver with Leica 3D guidance is slipforming a road in Dubuque, Iowa

This GOMACO GHP-2800 two-track paver with Leica 3D guidance is slipforming a road in Dubuque, Iowa. A GOMACO 9500 is placing material on the grade in front of the paver.

The 9500’s conveyor is being controlled by the operator’s remote control. The joystick is used for the up/down and right/left movement of the discharge conveyor.