Issues hinder growing construction industry

Posted by Design & Construct on 16-Apr-2015 01:41:39

In Architecture, Construction


After recent years of slow progress, the global construction industry is definitely moving in the right direction. This includes Australia, which was recently reported as expanding for the first time in many months by the Australian Performance of Construction Index.

Couple this with growing confidence in project planning and associated controls, there is no doubt that it is a good time to be active in the sector.

However, despite all this positivity, there are still some underlying issues that need to be addressed. These were recently illustrated in the KPMG International's 2015 Global Construction Project Owner's Survey: Climbing the Curve.

A total of 109 senior leaders from organisations conducting construction projects, including close to 40 from the Asia-Pacific region, were polled on how 2014 had progressed and what challenges they had faced in recent years.

New chapter, same story

According to the survey, more than half of respondents were involved in one or more underperforming project last year. In fact, project owners on average noted that under a third (31 per cent) of builds have come within 10 per cent of estimated budget in the past three years.

Additionally, only a quarter (25 per cent) of projects were completed within 10 per cent of original deadlines over the same time period.

Global Chair of Engineering & Construction Geno Armstrong explained that projects are now becoming bigger than ever and as such, more complex.

"The improvements by owners in planning and risk management have been significant, yet there is further work to be done to reduce the number of project failures, and bring more projects in on-time and on-budget," he explained in an April 2014 media statement.

What is the main issue?

It's fair to say that if a project can't find the right talent, progress will be hampered. This is exactly what is occurring in the industry, according to KPMG. 

A total of 44 per cent of respondents conceded they struggle to find qualified craft labour, while 45 per cent find it hard to attract skilled planners and project managers.

What is the answer to this issue?

One of the solutions to the talent shortages is working with a contractor recruitment agency. KPMG indicated that the owner/contractor relationship is one that will flourish in the coming years, if businesses can learn to trust these individuals.

While 82 per cent of respondents acknowledge the need for contractors, just 32 per cent have a 'high level of trust' in this talent source. 

"Project owners should continue to invest in relationships with contractors to raise mutual trust and discuss problems or shortcomings," Mr Armstrong concluded.

To learn more about how contractors can improve your construction project outcomes, contact the expert team at Design & Construct today.