March 22, 2024 AI Empowers Construction Industry Amidst Labor Shortage

Construction firms turn to AI to do more with less while reaping numerous benefits, including enhanced speed, accuracy and safety.

By Brian Thayer, Vice President & General Manager of Sales, AvidXchange

The construction industry’s current labor crunch shows no signs of stopping. According to a proprietary model developed by Associated Builders and Contractors, the industry will need to attract about 501,000 additional workers on top of the normal pace of hiring this year to meet the demand for labor.

With global demand for infrastructure continuing to surge (Deloitte reports that only 25% of the infrastructure required for 2050 exists today), there’s a plethora of work ripe for the taking. To seize new opportunities amidst a challenging environment that includes not only a labor deficit, but also rising costs of materials and supplies and ongoing economic instability, many firms are turning to technology for support. Rapidly advancing technology, including software and solutions driven by artificial intelligence (AI), can boost productivity and efficiency in construction and help enhance operation safety, speed, accuracy when the current workforce can’t meet demand and expectations.

Here’s a closer look at how construction firms are using AI to improve their workflows in several areas, including back-office administration, planning and logistics and job site management. 

AI Alleviates the Construction Labor Shortage By Automating Time-Consuming Tasks

Stretched thin to handle existing work, let alone take on new projects, construction firms are mindful of where time could be better spent. 

Automation promises relief for those still reliant on manual, paper-based processes for the industry’s notoriously complex invoicing and billing. Accounts payable (AP) automation software eliminates the need for manually entering data, chasing approvals across job sites and cutting paper checks. Instead, AI extracts and matches invoice data, routes to appropriate approvers based on predefined rules and workflows, and offers electronic payments options that are far faster and more secure. 

The modernized approach increases back-office efficiency, allowing AP staff to take on greater workloads and freeing their time for more value-added work, such as strengthening relationships with suppliers and finding new vendor opportunities. It also reduces costs by eliminating or reducing the need for paper, stamps and the overhead expense required for printers and file storage. By increasing the accuracy and speed of invoice processing, automated solutions ensure prompt payments to vendors and suppliers, helping to earn their loyalty and pave the way for future work.

Advanced Technology Increases Efficiency, Enhances Project, Supply Chain and Job Site Management 

In addition to creating efficiencies and cutting costs by automating time-intensive work, AI enhances the construction business by empowering firms with valuable insights. The tools harness and analyze vast amounts of data to help companies better forecast, bid and manage projects, and ensure that their staff and contractors make the most of their time. The insights allow them to predict project completion length and optimize scheduling. They are better able to allocate resources, taking into account multiple factors, such as material availability and costs, budgets, spending patterns and weather, helping to keep projects on track and ensure material and labor needs for future work. 

AI also provides predictive analytics and real-time assessments that can be used to protect and strengthen business. For instance, AI-driven maintenance systems analyze data to forecast when machinery is due for upkeep, helping to avoid costly downtime and repairs associated with unexpected breakdowns. The predictions and preventative maintenance protect project timelines and also have a significant impact on job site safety, as do cameras and drones powered by AI that can monitor construction sites in real time and detect safety violations and hazards that can be addressed before they cause injuries, delays or costly fines.

The use of AI-equipped robots and autonomous vehicles on job sites also enhances safety and creates efficiencies. Robots supplement workforces, easing labor needs and ensuring fast, accurate work, such as bricklaying and concrete pouring. Autonomous vehicles can be used to handle materials and provide excavation and grading with accuracy and precision.

Looking Ahead: Rapid AI Adoption Forecasted 

Despite economic volatility and an unrelenting worker shortage, the Dodge Construction Network projects the construction industry will grow 7% this year, faster than last year, to reach $342 billion. It’s expected that federal legislation, including the Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA), as well as a growing need for housing will continue to generate new opportunities for growth. 

According to Deloitte’s 2024 Engineering and Construction Industry Outlook, technology will continue to play an important role in shaping the industry. Technology will help firms address their most pressing challenges, including a need for efficiency to offset the labor crunch and higher costs of doing business. Deloitte predicts that the rise of generative AI, a subset of AI, and other disruptive technologies will be key to the industry’s digital transformation, impacting everything from project design to schedule optimization, cost controls, site inspection, and quality assurance.  

Construction firms that seize the advantages and opportunities offered by AI stand to reap impressive benefits, including a reduced need for hiring and a more rewarding workplace, in addition to faster, more efficient and accurate project outcomes.

As the Vice President of Buyer Growth Real Estate AvidXchange, Brian Thayer specializes in helping companies streamline accounts payable operations and creating efficiencies through automation and best practices. 

Throughout his ten-year tenure at AvidXchange, Brian has worked with hundreds of Real Estate companies, helping them evaluate and implement automation solutions. He is passionate about helping businesses become more efficient, reducing their environmental footprint, and positioning organizations to grow with negative financial impact. Brian received his BS in Business Administration, as well as Business Management & Marketing, from Bryant University.

Subscribe to Industry Today