Kerrick Whisenant, the president of the American Subcontractors Association, in his February newsletter to the membership, told of a meeting recently held in his offices with a group of ASA leaders who were asked to take a look into the future of the industry. This is his account of that meeting and the findings.
“The ASA Rap Council – ASA ‘s ‘think tank’ that develops innovative ideas for consideration by the association – took up the difficult but fascinating challenge of ‘peering into the future’ last month while meeting at my company’s offices in Alabama. Here is what members of the council foresee for the next 10 years:
- Differences between high-end and low-end specialty trade contractors increase, as high-end is quality/skill-driven and low-end is price-driven.
- Owners want fewer contractors for management and control purposes.
- Demand increases for new and stronger management skills driven by a changing industry and workforce.
- Multi-trade specialty trade contractors demand better management skills.
- Subcontractors at all levels learn to overcome price objections.
- Purchasing techniques change – for example, to include the cost of maintenance.
- New funding mechanisms emerge for construction.
- Changes in construction lead to new contract terms, which create new inequities.
- More manufacturer-like processes and work sites (e.g., prefabrication, robotics) are introduced.
- Labor-only contracts increase as owners strive to control material purchasing in order to take advantage of fluctuating material prices.
- Demand for professional contractors (and professional behavior) by other members of the construction team grows.
- Qualification and professionalism means more than certification.
- Contractors differentiate themselves through marketing and sales (as opposed to through providing the low bid).
- Worldwide competition for labor drives up labor costs.
- The workforce becomes increasingly minority.
- Access to cheap foreign labor declines as the economies of currently undeveloped countries rapidly expand.
- Management faces new challenges caused by the increasing demands by sensitive employees (e.g., generational and cultural differences).
- Subtle communication skills devolve, impacting plans, specifications and contracts, while technology helps address the lack of precision in plans and specs (e.g., BIM).
- Technology drives improved and faster payment.
- Reconstruction, renovation and repurposing of construction increases.
- Environmentalists have a bigger impact on where and how to build.
- Commodities prices increase, driven by growth in the currently undeveloped world.”
My favorite cartoon character says, “The Future is Verrry Hard to Predict!” Some of these predictions will become reality and some of them will happen at a more rapid pace than predicted. Whatever the future holds for your business, it is always good to know what your peers are seeing. How do these points fit into your thinking about the construction industry today?
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