Business, Earthmoving News

Builders confident about the year ahead despite concerns

New research shows Australian builders are confident about the year ahead, though rising construction costs are a growing concern

Procore vice president APAC Tom Karemacher

A new survey conducted by construction management software provider Procore Technologies found 85 per cent of Australian respondents are confident about the coming 12 months, up from 43 per cent in April 2020 as the impacts of COVID-19 were just stating to be felt.

However, this is behind the Asia Pacific average of 91 per cent and the Australian construction industry is lagging behind when it comes to adopting new technologies, Procore says in third edition of its construction industry benchmark report How We Build Now.

“The Australian construction industry remains remarkably resilient, however, there are lessons to be learnt from our Asia Pacific neighbours,” says Tom Karemacher, vice president, APAC at Procore Technologies.

“Our research found a clear correlation between positive industry sentiment and the intention to adopt technology, with ASEAN [Association of Southeast Asian Nations] countries taking the lead in this area. This enthusiasm should be instructive to the Australian construction industry, underscoring the power of digital transformation in relieving key industry pressures and supporting growth.”

The report showed that, despite the challenges of the COVID-19 pandemic, 43 per cent of Australian respondents agreed that it had accelerated their adoption of digital technology. However, there are still clear barriers to digitalisation – the most significant being changing established practices and behaviours.

According to the respondents, cutting edge technologies such as 3D printing, robotics and drones are less likely to drive industry change than more tried-and-true technologies, such as big data and digital project management platforms. Australian builders expect to save an average of 13 per cent on total project spend just by managing data more efficiently.

Looking across the Asia Pacific, Australia is behind on the digital maturity curve – with lower adoption rates of technologies such as building information modelling and pre-fabrication. New Zealand businesses (46 per cent) are almost twice as likely as their Australian counterparts (24 per cent) to believe next generation BIM technology will drive change.

Construction industry sentiment over the next 12 months

“The challenge is to bring all parts of the industry along on this journey,” engineering consultancy Cundall’s associate Hannah Morton says.

“I believe technology is an asset in this at every stage from early feasibility, design development and modelling through to project management, procurement and post-construction commissioning and verification.”

Although behind on digital adoption, Australia and New Zealand were the most likely to have site-specific safety plans.

The report also shows that the average Australian construction company spends one in every eight hours (12 per cent of its time) on rework, down from 18 per cent in 2020, and 43 per cent of construction decision makers believe technology will help improve resource efficiency through fewer errors. Of all five markets surveyed, the Australian construction industry spends the least amount of time on rework.

Less than half (48 per cent) of Australian respondents say the construction industry should adopt more green building practices, the lowest of all five markets surveyed, while rising costs and skills shortage the biggest concerns, followed by the skills shortage and decreasing profit margins.

In terms of diversity, while Australian construction companies have high rates of diversity and inclusion policies, on average, only one in five roles in construction are held by women and 61 per cent of respondents saw no need to improve this.

Paper is still commonly used by Australian builders for site activity records (29 per cent), environment (27 per cent) and estimating and pricing (26 per cent) processes, regardless of business size.

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