The construction and engineering industry is ever-changing, and during the post-covid period, this sector is now marking a significant recovery. However, the construction sector had experienced a huge turmoil during the 2020 slowdown, and its impact may persist for some time during the early years of this decade. However, the beginning of 2022 now seems extremely rewarding for the construction sector, along with being so challenging. The industry now looks poised to welcome growth opportunities in the future.
The recession that happened in 2020 was so short, but it had a longstanding impact across the globe. US economy was also hit, and so were the construction and engineering industries too. By the year 2022 now, we are moving towards a new direction of a quick recovery, and the construction industry now has a significant role in devising the nation’s growth plan. As Reddy Kancharla points out, the Infrastructure Investment and Jobs Act (IIJA) encourages investments in various sectors like health care, public infrastructure, public safety, etc. , if they can handle them well, will ensure a smooth, safe, and on-time project completion.
Overall, the construction and engineering industry now has increased investments in digital transformation, and many mergers and acquisitions are also happening at a faster pace. We can also see a fundamental shift towards connected technologies to increase construction capabilities. These advancements can help engineering and construction companies mention new initiatives in green cities, smart cities, mobility solutions, and climate change-related programs to enhance operational excellence and improve margins. Overall, 2022 is expected to be an exciting year for the construction industry.
Growth of industry
The construction industry responded well during the pandemic period and came out strong during the recovery period. The total spending on construction peaked at about 1.57 trillion dollars by the year 2021 July, which is a record 12% higher than the average levels of 2019. A recent survey by McKensie shows that about 91% of the engineering and construction sector respondents characterized their business outlook to be positive, which averages to about 23% higher than the previous year. There is an expected stronger performance in the residential construction segments in the coming years by driving this confidence more.
However, in the nonresidential construction segment, the growth was a bit weaker for most of the year 2021. The total spending across various sectors like office, educational, transportation, commercial facilities, healthcare-related construction, engineering, etc., has shown a fall.
During this recovery period, however, the construction industry landscape is evolving rapidly as more engineering firms and contractors actively participate across various levels of the value chain, which helps to improvise the growth and encourage connected technologies in construction. As Reddy Kancharla says, these connected technologies will help bring people, assets, and processes together to make it work much smarter and smoother by reducing cost and downtime in construction projects.