In recent years, the construction industry has benefited from a growing economy. Demand for new construction has been strong, and meeting this demand has required a large skilled labor force. But the market is changing. COVID-19 and the recent volatility in oil prices are having major impacts on the economy. Some industries will remain strong, while others will slow significantly.
Already, many companies in the oil and gas market are being forced to postpone or cancel planned construction projects. As new construction continues to decline, we can expect to see a reduced need for craft labor in this market. The duration of decreased demand in oil and gas will be difficult to predict as we plan for future projects in all markets.
Though the current circumstances are unique, this challenge is not. Construction market demand — and therefore, workforce requirements — are cyclical. While it can be difficult to predict exactly when the tides will turn, with careful planning it is possible to maintain efficiency throughout market fluctuations.
Construction-Driven Project Execution
Construction should drive the sequence of engineering and procurement deliverables. This approach allows project teams to identify tasks that can be efficiently performed earlier in the project timeline in order to reduce the peak workforce demand and improve productivity and schedule. For example, many projects can prioritize specific areas of construction that are not being driven by long lead procurement items.
Effective planning includes driving modularization early in the design process. Starting early allows engineers to design specifically for modular components that can be transported to the site when needed. When a higher percentage of construction is completed within a structured environment away from the job site, the labor and schedule can be better controlled. The schedule also can be streamlined with parallel construction paths occurring at the site and in the shops.
In addition to modularization, many design decisions can be made to address market variables such as workforce availability. Across all markets, early constructability reviews can result in solutions that improve efficiency in the field. For example, electrical transmission systems can be designed to promote aerial installations. For stick-built heavy industrial projects, construction can drive location of connections to reduce the amount of scaffolding required and improve access to the work.
Job Site Technology
A variety of tools can be integrated into construction planning and progress monitoring work processes. Embedding these technologies into engineer-procure-construct (EPC) execution allows you to better track work scope by priority and manage the overall progress of work packages from design to installation. You can also identify opportunities to reduce craft density to improve safety performance and efficiency.
Additionally, the construction industry needs to continue to lead the charge on workforce readiness through all cycles of labor demand. Regardless of current market conditions, the demographics of the workforce will continue to evolve as much of the industry’s craft labor and supervision approaches retirement. It is important to continue raising awareness of the different career options available in construction and make training readily available to aspiring craft laborers and supervisors.
If there’s one constant in construction, it’s that demand is always changing. We don’t know what the market will look like a year or more from now, but we can prepare for the unexpected by implementing construction-driven project execution, strategic design and workforce readiness plans that prioritize efficiency and flexibility.