Key Industry Trends from 2023 and What’s Ahead for Construction Industry in 2024
As we approach the end of 2023, it’s time to reflect on the significant trends that have shaped the construction industry this year and to look ahead at what we can expect in 2024.
Key Developments of 2023
- Commercial Real Estate Dynamics: 2023 saw a downward trend in the commercial real estate market, reflecting broader economic shifts and uncertainties.
- Sustainability and Green Building: The push for sustainability continued to be a major theme, with carbon recapture and tax credit incentives driving green building practices. Notably, mandates like New York City’s Local Law 97 required large buildings to cut emissions, hinting at stricter regulations in the future
- Inflation and Supply Chain Challenges: Inflation and supply chain disruptions remained persistent challenges throughout the year, leading to increased material costs and budget uncertainties. This trend caused financial strains and potential disputes among stakeholders in construction projects
- Labor Shortages: The construction industry continued to face labor shortages, pushing wages higher and impacting project costs. Despite a decrease in material costs, labor expenses, especially for skilled subcontractors, remained high
- Material Cost Fluctuations: Material costs saw fluctuations, with overall costs decreasing but still contributing significantly to project expenses. International shipping rates and transportation costs also stabilized after periods of volatility.
The five hottest skilled jobs in the construction industry for 2023:
- Electrician: Responsible for installing, repairing, and maintaining electrical systems, with an average salary of $57,311
- Carpenter: Skilled in various aspects of construction including erecting walls and constructing floors, with an average salary of $61,819.
- Plumber: In high demand as the industry grows, with an average salary of $59,880.
- Mason: Essential for building homes and other structures, with an average salary of $61,000
- Heavy Equipment Operator: Operates heavy machinery and equipment, with an average salary of $73,280.
For construction employers looking towards 2024, adapting to evolving hiring challenges will be crucial.
Here are five hiring strategies employers should consider embracing:
- Invest in Training and Apprenticeship Programs: To combat the skilled labor shortage, investing in training programs can help develop a pipeline of qualified workers. Apprenticeships can attract new talent, particularly among younger demographics, and provide hands-on experience.
- Embrace Technology and Digital Tools: Utilize digital platforms for recruitment and skill assessments. Leveraging social media and online job portals can widen the search for potential candidates.
- Enhance Employee Value Proposition: Offer competitive salaries and benefits, but also focus on creating a positive work culture. Providing opportunities for career growth, continuous learning, and emphasizing work-life balance can attract and retain talent.
- Diversity and Inclusion Initiatives: Implementing diversity and inclusion strategies can expand the talent pool. This approach can include targeted outreach programs to underrepresented groups and creating an inclusive workplace culture.
- Flexible Work Arrangements: Considering the nature of construction work, offering flexible schedules or project-based contracts can attract a broader range of candidates, including those seeking non-traditional employment arrangements.
It’s clear that the past year has been marked by significant challenges and transformative trends. From dealing with labor shortages and the complexities of material costs to embracing sustainability and technological advancements, the industry has shown resilience and adaptability. Looking forward to 2024, construction employers must continue to innovate in their hiring strategies, adapt to evolving economic and environmental landscapes, and leverage technology to stay ahead. The coming year presents an opportunity for the industry to build on the lessons of the past twelve months, embrace new challenges, and continue its crucial role in shaping our built environment.
