Dec 7, 2022
4 Minute Read
Megaprojects Are Hindered By Challenges, But Safety Can Bring Them Back On Track
James Barlow is the CEO of BZI Steel, a leading technology steel erection company providing construction project safety and efficiency.
When you hear the words “construction megaproject,” what comes to mind?
You might think of massive structures such as commercial buildings, airport terminals and distribution centers—and that would be correct. According to one definition, megaprojects “are large-scale, complex ventures that typically cost more than $1 billion, take many years to build, involve multiple public and private stakeholders, are transformational and impact millions of people.” As an extreme example, the biggest megaproject in the world is the International Space Station, which has been in operation and construction since 1998 with an estimated cost of more than $150 billion.
With the recent pandemic, many important megaprojects are facing significant delays due to ongoing supply chain issues, a lack of skilled labor and cost issues. According to McKinsey and Company, 98% of current megaprojects face cost overruns and delays of up to 20 months. In addition, supply chain issues are now coupled with rising inflation, making the overall price to secure the right equipment and construction in America much more expensive than in years past.
And labor is in short supply. The Associated Builders and Contractors (ABC) noted that construction is facing a workforce shortage of over 650,000 workers this year. Moreover, with the average retirement age at 61 years old, a fifth of the industry could resign within the next six years.
But I believe the most pressing issue to ensure megaprojects are completed on time is safety. According to the U.S. Bureau of Labor Statistics, construction has the third highest death rate for jobs in the U.S., making it less attractive than other careers. Therefore, the construction industry must make safety a number one priority for every project—safety cannot be sacrificed for efficiency.
So, how do we prioritize safety on construction megaprojects when there is constant pressure to complete projects quickly and with a lack of skilled labor?
I firmly believe that embracing new technologies that make the construction industry safer is critical. But this is only possible with a dedicated research and development (R&D) division and budget. According to McKinsey, the construction industry spends less than 1% of its revenue on R&D. This is compared to the auto industry, which spends 3.5%, and the aerospace industry, which spends 4.5%. Even more concerning, many construction companies do not have any budget for R&D whatsoever, with 56.8% of those surveyed in the MCAA-Focused Construction Technology Report admitting to such.
In addition to building out the R&D function, new technology advancements are making safety on megaprojects paramount. Examples include digitizing safety processes on a mobile app that compiles all data in real-time and enables remote management of construction sites; construction wearables that alert when a worker is being exposed to dangerous chemicals or physically is not well enough to work; and even drones that can safely monitor and inspect worksites from the air while leaving workers safely on the ground. Investing in these advancements might seem expensive and overwhelming at first, but it can ultimately pay off.
Most importantly, teams must be adequately trained on the latest safety advances to handle these large-scale and timely projects. Based on personal experience, I highly recommend in-depth and continuing job site safety training. Consider utilizing OSHA-authorized instructors and offering hands-on instruction. Making safety a top focus in your culture can lead to improved compliance with safety requirements on job sites and increase team member performance and overall satisfaction.
Despite the challenges, a revolution is coming for construction. McKinsey noted that 60% of construction executives believe significant technological shifts will occur within the industry in the next five years, helping bridge the gap between project delivery times and safety concerns. This can help make construction labor jobs more attractive to younger generations who are already technologically savvy. Safety does not have to be sacrificed for efficiency; the two work hand-in-hand.
Now is the time to take action. By investing in promising technologies, hiring the right teams to manage these advances and prioritizing safety, I believe megaprojects will get back on track, and we can be at the forefront of the revolution that’s coming in our industry.