Lessons learned from the impact of COVID-19 on the global construction industry
Summary (3 min read)
Introduction
- The construction industry represents most of every country's savings and vital to continued economic growth and activities, especially in developing countries.
- In total, seventy-six (76) respondents from 5 continents excluding South America responded to the online open-ended structured questionnaire.
- Supply chain management, construction project management improvement, concentration on health and safety and effective virtual working environment were collated as themes on lessons learned.
- The construction industry can categorically identify the positive and the negative impact in the industry as detailed below. >>>.
2.2 Positive impacts
- Ogunnusi et al., (2020), and Kshirsagar, Mansour and Metakis (2020) identified ‘opportunity to improve on virtual alternatives’ as a positive side of the COVID 19.
- Some staff in some contracting industries were offered relevant technology such as laptops and mobiles to continue working from home.
- Remote working has significantly saved a company per month paper printing from 35,000 sheets to 1000 sheets (Stride, Suresh and Renukappa, 2020).
- Identifying new opportunities created with the pandemic, Alsharef et al., (2021) noted new opportunities experienced in the construction industry to recruit skilled workers; demand in the transportation, medical and residential sectors; and lower interest rates.
- Industry 4.0 is set to proceed rapidly, describing the movement of the construction industry in the UK towards an automated digital environment (Stride, Suresh and Renukappa, 2020; Lepore, Micozzi and Francesca, 2021; The University of Cambridge, 2020; Melluso et al., 2020).
2.3 Negative impact
- The negative impacts of COVID-19 on the construction industry largely stem from the UK Governments ‘Construction 2025 report’, two-thirds of construction contracting firms are not innovative and consequently freezing technological progress within the sector.
- Companies experiencing site delays and considerable cash flow issue, skill shortage.
- Remote working with home-schooling for staff with children was a serious challenge (Stride, Suresh and Renukappa, 2020; Arup, 2020).
- Ogunnusi et al., (2020) considered the negative side of COVID-19 as delays in the completion of projects, hardship encountered by daily paid labourers, budget delays, properly scheduled project disruption, real estate sector revenue slowdown (PWC, 2020).
- Increase rate of mental health issues due to people not having physical contact, especially those who are not used to working from home (King & Lamontagne, 2021; Stride, Suresh and Renukappa, 2020).
2.4 Research gap
- The research gap derived from the review of focal literature in this study, is the lack of considerable article on the impact of COVID-19 on other construction industries outside the scope of the UK, United States, and European Union countries which represent the sources of references in the review of focal literature.
- This investigation delves into the lives of the respondents from a qualitative outlook.
- Survey interviews were employed in inducing new theories surrounding the impact of COVID-19 on the global construction industry.
- The structured interview questions were designed to extract information from the wider construction industry through the random sampling technique.
- Zoho Analytics is data visualisation for quantitative and qualitative data.
3.1 Participant profile
- Figure 2 illustrates the 76 participants around the world, which were distributed across five (5) continents excluding South America.
- Due to the cross-sectional nature of the study, it was difficult to extract responses from South America.
- 4<<< Figure 3 displays the breakdown distribution of the participants along the professional lines.
- The educational qualification is essential in understanding the nature and quality of responses. >>>.
- The architects (ARC) involved in this study mainly act as contractors (1) and designers (11).
4. Qualitative analysis and discussion of findings
- The analysis was of the responses in terms of the positive, and negative impacts along with lessons learned through Zoho AI analytics web-based platform.
- The respondents’ professions and years of experience were mainly used to outline the key responses.
- The content analysis of the findings necessitated the convergence of similar responses generated from the professional and years of experience viewpoints were collated and compiled in Tables to further strengthen the discussion of the merging themes.
4.1 The positive impacts of the COVID-19 Pandemic on the construction industry
- From the qualitative analysis as presented in Figure 6 and Table 2, the positive impact of COVID-19 on the construction industry were derived from the respondents based on their years of experience.
- Insert Figure 6<<< >>>Insert Table 2<<< Table 2 presents the themes which emerged from combining the common contents.
- In the COVID-19 pandemic, construction overheads such as the cost of travelling to construction sites and office reduced.
- Stride, Suresh and Renukappa (2020) and Arup (2020) have previously identified remote working as a key benefit that may facilitate the reduction of overhead costs in the construction industry.
- The COVID-19 pandemic has now made construction organisations prepare for the worst-case scenarios; provide a clear vision on how construction businesses can be managed in the instance of another epidemic whilst understanding how to manage businesses in times of crises.
4.2 The negative impact of the COVID-19 Pandemic on the construction industry
- Following the consistent pattern of categorising the comments of the respondents in this study, themes were developed from Figure 7 cluster maps.
- Insert Figure 7<<< >>>Insert Table 3<<< Respondents with 5-10 years of experience in this section of the study were mainly drawn from Europe, Africa, and Asia.
- Construction businesses just like every other business around the world had to absorb the financial shock of delays in delivering construction materials; downtimes on construction sites; and suspension in cash flow from the client.
- BE1 from the United Kingdom identified “…Distrupted socialisation, job loss and redundancy…”, as the major negative impacts COVID-19 had on the construction industry.
- The challenges of working from home and mental health are evident in the fact that some construction professional may decide to work when they should be sleeping.
4.3 Lessons learned for future-proofing the construction industry
- The responses on lessons learned were mainly from Europe and Africa.
- Respondents with over 15 years of experience provided more of the clustered lessons learned from COVID-19.
- CSE10 was suggesting an opportunity to enhance the supply chain system of Nigeria with new technology such as BIM.
- Hence the need to improve construction crisis and risk management responses in project plans.
- CPM12 from Canada suggested that “health and safety has now become more important in the construction industry”.
5. Implications of findings: future-proofing the construction industry.
- The ability to continue to provide the programmes of work that are needed to reinforce the world's economic growth and recovery shortly requires that the consultants, clients and contractors come together and proffer a common solution to the challenges encountered during the pandemic (Mace, 2020).
- Page (2020) also categorically states that “force majeure” is not the best solution.
- This may depend on the contract content whether it is with or without relief provisions.
- As project resumes and site reopens, existing contracts may be modified to reflect the “new normal”, that is, COVID 19-specific provisions such as Health and Safety, Site Management, Materials and Supplies Shortages, Performance Security and Step-in Rights.
5.1 Implications for further research
- The qualitative analysis in this study was conducted to provide an opinionated overview of how COVID-19 has impacted the lives of people in the construction industry around the world.
- The impact of BIM in the COVID-19 epidemic.
- Enhancing standard form of contract suite to meet the needs of epidemics.
- Considering the enormity of influence COVID-19 have had on the global construction industry, there is a need to further study the impact of COVID-19 on the construction industry.
6. Conclusion and limitations of the study
- The positive, negative and lessons learned impacts of COVID-19 on the global construction industry were felt in the areas of the construction supply chain; contract administration; construction project management; changes to the working environment; health and safety management; and the finances of construction organisations and individual employees of the construction industry.
- In all, 76 respondents provided feedback from 5 continents excluding South America.
- In so doing, this study’s limitation is evident in the lack of responses from South American construction professionals.
- The implications of the lessons learned for construction project management; construction occupational health and safety; supply chain management; and virtual working environments; all necessitate advanced in construction information technology and research.
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Frequently Asked Questions (14)
Q2. What have the authors stated for future works in "Lessons learned from the impact of covid-19 on the global construction industry" ?
The following headings are areas of future research. Considering the enormity of influence COVID-19 have had on the global construction industry, there is a need to further study the impact of COVID-19 on the construction industry. The abovementioned research areas may be studied from a micro-perspective of national, geographical, organisational, project, economic, social and technological inclinations.
Q3. What were the positive and negative impacts of COVID-19 on the construction industry?
Positive impacts of COVID 19 in construction industry were virtual alternatives, lower interest rate while negative impacts were site delays, cash flow issues, skill shortages, project suspensions amongst others.
Q4. What are the main lessons learned for the construction industry?
Other lessons learned for the future of the construction industry were aimed at improving the management of COVID -19 risk at work; improved supply chain relationships and responsibility; workers engagement; efficient site induction processes; increase in remote meetings using communication technologies.
Q5. What was the main benefit of the construction industry from the qualitative analysis?
Remote working environment Opportunities to work from home as a new flexible work-from-home model in the construction industry had been identified as a benefit of the construction from the qualitative analysis.
Q6. What was the main impact of COVID-19 on the construction industry?
BE1 from the United Kingdom identified “…Distrupted socialisation, job loss and redundancy…”, as the major negative impacts COVID-19 had on the construction industry.
Q7. What are the main negative impacts of COVID-19 on the construction industry?
The negative impacts of COVID-19 on the construction industry largely stem from the UK Governments ‘Construction 2025 report’, two-thirds of construction contracting firms are not innovative and consequently freezing technological progress within the sector.
Q8. What is the main reason for the improved productivity?
Improved productivity may also result from flexibility in the workplace as noted by African and Australian respondents who were able to return to work at their convenience when the epidemic situation was better.
Q9. What percentage of the respondents hold a masters degree?
60.5% of the participants hold Master of Science (MSc) degrees, 31.6% have first degrees, 7.5 % have a higher education or college degree and the remaining population, 0.4% have Ph.Ds.
Q10. What was the main reason for the decline in construction output during the COVID-19 pande?
construction output declined during the pandemic because the global construction industry experienced a shortage of construction materials, and material delivery delays (Alsharef et al., 2021).
Q11. What is the key benefit of working flexibly in office setting?
Improved productivity was identified by Pirzadeh and Lingard (2021) as a key benefit of working flexibly in-office setting or at home.
Q12. What is the benefit of working from home?
When employees of the construction industry work from home, all overhead costs associated with office-related activities such as printing, electricity, waste and water usage are eliminated.
Q13. What are the implications of the lessons learned for construction project management?
The implications of the lessons learned for construction project management; construction occupational health and safety; supply chain management; and virtual working environments; all necessitate advanced in construction information technology and research.
Q14. What is the reason for the recommended limit of working hours?
A recommended limit of working hours can be designed for virtual environments because it is likely construction professionals may want to finish a weeks’ work in a day.