Construction Industry Trends: January 2024 Round-Up
A look at the trends and happenings in construction from January 2024
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January might’ve had a sleepy start to the new year, but some big things are starting to develop.
Turner Construction had a big month, announcing its involvement in two projects (both mentioned below). Also, data center construction is hitting overdrive, with three massive projects selecting their contractors. On top of that, Disney is hoping for a fairy tale ending after proposing a major expansion to one of the happiest places on earth. And, the industry did add jobs in January, but the workforce gap continues to grow.
The following are some of our favorite stories from January.
A Big Month for Data Centers
Data centers and tech infrastructure are continuing to grow, and it’s a good thing for the construction industry. In January, three major players in the tech industry selected the first they’re entrusting to undertake major projects in different areas of the country.
Formerly known as Facebook, Meta Platforms has plans to build an $800 million data center in Jeffersonville, Indiana. The facility will stretch over 700,000 square feet, and Turner Construction was chosen to head up the efforts. Construction is slated to begin any day and the facility should be operational by 2026.
Another massive data center project belongs to Google, which announced plans to construct a $600 million facility in Wasco County, Oregon. This facility is planned to be just under 290,000 square feet, and Whiting-Turner Contracting Co. has been selected to pilot the project. Google is no stranger to spending big money in Oregon, as the company has invested over $1.8 billion in Oregon facilities over the last 18 years.
Finally, EdgeCore Digital Infrastructure is building a $1.9 billion data center in Mesa, Arizona. EdgeCore has selected Holder Construction to construct the 3.1 million square foot facility. The Broomfield, Colorado-based EdgeCore is a data center developer and operator and has four other data center campuses in the US.
Check out industry trends from December 2023!
Disneyland Forever Proposal: Not Such a Mousy Proposition
The Mouse has big plans for its Disneyland location. In mid-January, company representatives met with the Anaheim city council to propose some big changes to the company’s Disneyland park and the city around it. In the meeting, Disney proposed a $2.5 billion plan that involved Walt’s company spending at least $1.9 billion in new rides, accommodation, retail spaces, and parking areas—job makers for the local community.
The DisneylandForward project plans to expand beyond its 490-acre footprint, pending zoning approval from the city council. It will then follow suit as it has done in some of its other parks, creating attractions based on particular films to create a more immersive experience for park visitors.
The plan also involves Disney paying $40 million to take over some streets adjacent to the park, and $100 million on improvements to the city’s infrastructure.
Turner-Everett Joint Venture is a Slam Dunk
New York-based Turner Construction is taking it to the rim with contractor D.A. Everett Building Group. The two contracting firms are teaming up to improve the home of the Charlotte Hornets: The Spectrum Center.
The project comes on the heels of a contractually obligated distribution of $275 million from the city of Charlotte. The NBA franchise will use this money to improve the 18-year-old facility during the summers of 2024 and 2025, with the project expected to wrap by the 2025-2026 NBA season.
How much the renovation will cost is unclear. The team’s two new owners, Gable Plotkin and Rick Schnall, will contribute their own money to the renovation, as well.
The project will include renovating the main concourse, an investment in hospitality spaces, adding 2,500 seats to the lower part of the arena, additional suites, fan experience tech like checkout-free markets, and important HVAC, connectivity, and performer technology renovations.
Construction Employment is Up, But So is the Workforce Shortage
January marked the 10th straight month of job growth for the construction industry. According to the U.S. Bureau of Labor Statistics, the industry added 11,000 jobs in January alone. This represents a 2.7 percent increase in jobs since January 2023. And while construction unemployment rose to 6.9 percent, the month was also tied for the third-lowest rate of January unemployment on record.
- Nonresidential construction added 7,600 jobs
- Nonresidential building: +1,600
- Nonresidential specialty contractors: +13,700
- Heavy and civil engineering: -7,700
- Nonresidential building: +1,600
- Residential construction added 2,700 jobs
- Residential building: +2,500
- Residential trade contractors: +200
- Residential building: +2,500
While the growth is obviously positive, there’s another statistic growing: The workforce shortage. According to the Associated Builders and Contractors new release, the shortage has topped half a million additional workers (501,000 to be exact). It’s estimated that, at this rate, the industry will have to attract 454,000 more workers on top of normal hiring to meet industry demand.
In response to the shortage, workers have been able to demand top-dollar for their expertise. Pay rates increased an average of 5.2 percent, with average hourly earnings reaching $37.55. The hope is the rate increase will not only attract and retain experienced employees but also attract new workers to the industry, reducing the impact of the workforce shortage.
New Tech Hitting the Market
The Year 2024 will see more than its fair share of technological advancements, but four big players hit the market at the turn of the new year. The following software and tech programs aim to help companies work more efficiently and improve their workflows.
- TrunkTools: An AI-based platform that scans all of the documents and drawings associated with a project, and then answers text-based questions about the data. For example, a contractor could simply ask the program, “How many doors do I need, and in what sizes?,” to which the program will respond with an accurate answer.
- StructShare: Another AI-based program that helps specialty contractors decide on which material to purchase, taking into account pricing, supply chain issues, and availability. It also tracks current inventory levels, allowing contractors to make better decisions.
- AutoDesk: The software giant Autodesk just released Autodesk AI. The program offers AI-generated models for flood maps for stormwater control and drainage plans. It also created noise, wind, and energy analysis tools to help architects and designers generate interactive models.
- Sage: Another leader in the accounting software space, Sage added Sage Construction Management this month. This program is for preconstruction and project management tools, which works directly with the company’s financial software. Through the Construction Management tool, contractors can complete bids, estimates, schedules, and more.
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