Data Drives Success: The AGC Minnesota Construction Industry Assessment
An annual industry survey assembled by Associated General Contractors of Minnesota provides a detailed look at the state’s construction economy
By Sheri Hansen | September 22, 2022
Image courtesy of AGC of Minnesota.
FEATURE
For the past decade, Associated General Contractors (AGC) of Minnesota, a nonprofit that serves the construction industry, has been reaching out to the full sector to capture data on what’s happening in the marketplace. Hundreds of respondents from design, engineering, and specialty and general contracting firms, along with industry suppliers and service providers, share their thoughts about the road ahead in the annual Minnesota Construction Industry Assessment.
At the national level, AGC, the American Institute of Architects (AIA), and other organizations representing different facets of the industry regularly produce industry data that cover some of the same topics, but these reports often do not have the same state-specific information as the AGC of Minnesota survey. The Industry Assessment also crosses disciplines to look at the design and construction industry as a whole.
AGC of Minnesota CEO Tim Worke.
“We feel our survey is absolutely essential to how the industry prepares for what’s in our own backyard,” says AGC of Minnesota CEO Tim Worke. “We capture data from all over the state, from firms of all sizes and disciplines, to try to help everyone understand what’s happening on the ground in Minnesota, and to think about ways they can adapt their practices to stay healthy and competitive in the marketplace.”
The survey elicits firm leaders’ perceptions of the marketplace overall as well as anecdotes about the factors impacting their work. For instance, advances in technology, COVID-19 impacts on workforce, and the supply chain have been identified as leading influencers of sector health. Respondents also cite robust federal and state funding programs for infrastructure and the built environment as important to keeping the industry healthy.
The 2020–21 and 2021–22 surveys highlighted a range of pandemic impacts, from project holds and cancellations for both public and private sector projects to the substantial additional costs associated with personal protective equipment, new training and practices, and providing for a remote workforce. At the same time, the reports registered industry optimism that a generally robust economy would continue to support significant project funding and a healthy project pipeline, even when holds are considered.
“We capture data from all over the state, from firms of all sizes and disciplines, to try to help everyone understand what’s happening on the ground in Minnesota, and to think about ways they can adapt their practices to stay healthy and competitive in the marketplace.”
The survey is more detailed than many other industry temperature checks. “It allows us to dive deep with our partners in the industry, to try to get at what folks in the field are actually dealing with day to day,” says Worke. “When we ask about supply chain issues, we get into whether it’s lead times or costs that are most worrisome. When we ask about workforce, we explore the nuances of availability, skill level, wages, and productivity. This can help business leaders identify and solve problems at a more granular level and really impact the bottom line.”
Last year, the survey identified workforce challenges on the horizon in the building trades that include concerns about the health of the more traditional sources of workers—trade schools and training programs. It also spotlighted a significant increase in skilled workforce demand as the sector has grown over the past decade. Operational costs and office staff are also key considerations, as is adaptation to new technologies and remote work for the existing workforce.
The survey also explores diversity in the industry, gathering data on the number of minority-, women-, and veteran-owned firms and inviting respondents to share their experiences with barriers to entry and success in the industry. The 2021–22 report noted how the lack of minority-owned businesses in some market areas hampers partnerships and growth, and that growing a more diverse workforce takes intentional conversations about workplace culture and deliberate, consistent outreach to groups that have not traditionally worked in construction.
In addition to quantitative questions, the survey includes open-ended questions that give respondents an opportunity to share anecdotal information about the state of the industry. Recent responses have raised issues related to public policy that impacts the industry, noted the stress that the workforce and business leaders faced throughout the pandemic, and expressed concerns about whether high levels of productivity can be maintained in the face of rising costs and supply chain disruptions.
“We’re launching our next industry survey this week, and it will be very interesting to see how attitudes and conditions have shifted since last fall,” says Worke. “The COVID-19 pandemic is shifting into endemic mode, which should be better for the workforce overall. We didn’t get a bonding bill in the 2022 legislative session at the state level, but significant funding for infrastructure and buildings is coming from the federal government. The private sector is shifting plans for space, especially commercial and office spaces, due to the remote work revolution. We hope the next survey can help our industry not just survive what’s ahead but thrive.”
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