How Do You Expect Your Construction Company to Evolve Over the Next 5 Years?

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Zaid Rahman
May 6, 2022

It’s no secret that the construction industry is facing issues such as modernization, a drive toward sustainability, labor shortages, and rising material costs.

Construction owners know that to keep up with these changes in the industry, some planning is required. 

We asked construction owners across North America how they expect their construction companies to evolve over the next five years to adapt to these changes and here’s what they had to say.

5 Major Changes Affecting the Construction Industry in the Next 5 Years and How Owners See Their Companies Evolving

#1: Green Construction

From large-scale sustainability, such as reducing energy waste and increasing productivity, to providing businesses and homeowners with green solutions, the construction industry is rapidly shifting toward establishing sustainable construction procedures as the norm.

Green construction has become an expected standard, and while much of it remains a luxury, renewable energy sources captured 11% of the energy market in 2019 and skyrocketed to 20% of the energy market in 2020 — and they’re only expected to grow.

How does this affect the construction industry? Green construction involves the technology that allows contractors to lower their carbon footprint while offering companies and homeowners solutions such as commercial greenscaping or solar technologies.

John Hogan, president of Blue Nail in New Jersey, said, “We plan on expanding our solar division within our office to stay on top of permitting and documentation that is required for solar installations. We will continue to grow and learn the best technologies and solutions to help our customers in the roofing and solar space.”

While many remain hesitant toward green construction, mainly due to higher costs, it’s an option that must be thoroughly explored as the future of construction. Not only does green construction benefit our environment but it establishes a higher standard of living.

#2: More Residential and Remodel Projects

In 2021, residential construction spending was up by almost 25% as more tech companies invested in complex megaprojects on a global scale. As a result, fewer construction companies are pursuing public-private projects and opting for lower-risk arrangements instead.

Even on a smaller scale, residential remodels increased due to a highly competitive real estate market and rising housing costs. According to the National Association for Homebuilders, remodel projects were up by 10% in 2021 and the trend is expected to continue through 2022 and beyond.

Thomas Borcherding of Homestar Design Remodel in Missouri suggests that this may have something to do with COVID-19, saying, “It most likely has spurred the current growth in remodeling demand due to the stay-at-home work culture.”

#3: Augmented and Virtual Reality

Augmented and virtual reality continues to increase in popularity in the construction space as a technology that can move construction processes forward, prevent costly mistakes, and allow for fewer delays.

The leading technology allows construction managers to gain an in-depth and detailed look at the entire project, allowing them to plan more accurately and efficiently. It’s estimated that the use of virtual reality in construction can reduce costs by up to 90%. 

Shad Elia, CEO of New England Home Buyers, said, “I believe that augmented and virtual reality are gaining traction in the construction industry. AR and VR have the potential to revolutionize the building industry. Construction managers may now get a complete overview of the entire project and plan ahead thanks to this cutting-edge technology.”

He added,“This virtual representation of the structure's final shape can aid in the avoidance of costly errors and the reduction of delays. Furthermore, because you will be able to predict the exact needs of your building project ahead of time, better planning will result in reduced waste of resources.”

#4: A Subcontracted and Skilled Workforce

As the industry continues to change, a new reality of emerging technologies is at the forefront of these changes. As a result, the construction industry has the unique opportunity to take advantage of skilled and educated young professionals, many of whom are working as subcontractors.

The introduction of new technologies and the growing use of software within the field are transforming the construction landscape, and while laborers will always be needed, many companies find themselves working more closely with local and remote subcontractors than ever before. 

Taking into account the serious labor shortage in the construction industry, for many, this is good news. Thomas Borcherding of Homestar Design Remodel said, “In the next five years we expect to hire more salespeople and designers in order to accommodate the continued growth of remodeling needs. We plan to continue to use subcontractors. Some homeowners think a company that uses subcontractors is a red flag. We believe the contrary. A company that has in-house installers is going to have to focus on job quantity in order to keep those installers busy. On the contrary, we are able to focus on job quality.”

With many construction companies still working with pen and paper to complete their projects, a younger generation of skilled and educated workers are entering leadership and ownership roles, allowing for more futuristic solutions. By subcontracting skilled workers, construction owners can build long-term relationships with a tech-savvy workforce. 

#5: Construction Management Software

Construction management software empowers the entire construction process by allowing real-time communication between all parties involved, decreasing delays, and reducing costly errors and budget miscalculations.

One survey showed that 89% of construction managers and 78% of construction and engineering professionals say that job site data is critical to the success of a project, yet nearly half of all managers claim that data processes are still done manually.

The cost of these manual processes can be staggering, yet so many companies have yet to get on board with construction management software.

Those who have, have seen a significant change in the way they do business. John Hogan of Blue Nail said, “COVID-19 has affected our business and helped us continue to innovate with new technologies to set the standard for the industry. We have to communicate more instantly and act like the Uber of the construction industry to provide a higher quality service.” 

He added, “People don’t want to sit through home demos at the kitchen table; they want to find the company that they know, like, and trust online and have their problems solved without having to get involved.”

Hogan recognized a problem within their current processes and proactively sought out a solution, which for them meant updating technologies and establishing new practices. Hogan said, “For us, that meant implementing drones, video technologies that help explain their issue, and transparent proposals with electronic signatures that make things efficient. We also built our own app that allows customers to check in on their production status, message us, and refer friends and family.”

How Flexbase Is Helping Construction Companies Evolve Through Changes and Challenges in the Industry

Whether your construction company is facing the challenges of an ever-evolving industry, or you’re a start-up company looking for a credit card that helps you hit the ground running in the current industry climate, Flexbase has a credit card designed specifically with construction companies in mind. 

With the Flexbase card, you’ll get 10x the credit limit that traditional credit card companies offer, 0% APR for 60 days, $0 annual fees, instant cash rewards, and more. 

Get pre-approved today by clicking here.

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