Procore has released the results of a survey exploring how COVID-19 has influenced the outlook, impact and technology use of Australian builders.
It's unsurprising that business confidence has dropped considerably at this time. Sixty-nine percent of construction companies were confident about industry business conditions at the beginning of the year, compared to only 43 percent two months later. Small businesses are the hardest hit – only 30 percent working in businesses of 10 or fewer are confident about industry business conditions. Thirty-three percent of builders in the survey said they would need to close down if business doesn't improve over the next 12 months.
Despite the 'essential service' label, which allows building and construction work to continue, there are signs of work slowing down. Many builders are turning to technology in this time – 48 percent are using technology to help manage risk, 38 percent are relying on technology to increase productivity and 39 percent are using this quieter period to update technologies, systems and processes.
Other key findings from Procore's 'How We Build Now – Tracking Technology in Construction 2020' report include:
- the number of construction projects is expected to drop by 34 percent
- the value of projects is expected to drop by 33 percent
- commercial and industrial projects are likely to be the biggest hit, with a drop of 19 percent
- 22 percent of small construction companies are cutting staff wages to the minimum JobKeeper allowance
- 55 percent of large companies (100-plus employees) are reducing remuneration for business owners and senior executives
- 41 percent are using fewer subcontractors on site, and
- 30 percent are using technology to reduce the volume of materials that need to be held on-site.
"While this pandemic has brought significant challenges to Australian construction," says Tom Karemacher, vice president APAC at Procore Technologies, "it is a resilient industry that has weathered its share of economic downturns... I'm so impressed with the camaraderie we are seeing in the industry and how quickly companies have pivoted to make the most of technology to support their businesses."
Dean Willemsen of Prime Build has used the period of change to overhaul management and personnel practices. "We've seen a slight downturn in work and the pipeline for the months and years ahead has become slightly uncertain.
"[We] now have the opportunity to think about how we can better leverage the people, processes and technology we've got, more effectively," adds Willemsen. "What we do now will define our businesses in the future."
Two-hundred-and-sixty construction companies across Australia took part in Procore's survey in February; this was followed up by a second survey of 152 companies in April.