In recent years, the world has witnessed a series of extreme weather events causing widespread destruction and economic loss. For example, in 2020, the Atlantic hurricane season broke records with 30 named storms, while wildfires in Australia and the United States devastated vast areas. These events underscore a new reality: we are facing an era of heightened risk from extreme weather, posing significant challenges for the construction industry.
Recent statistics paint an even starker picture. In 2021, global insured losses from natural disasters reached $105 billion, with the construction sector bearing a substantial portion of these costs. The UN Office for Disaster Risk Reduction reported that in 2020 alone, extreme weather events displaced over 30 million people worldwide, disrupting countless construction projects. The economic toll extends beyond immediate damages, with long-term implications for project timelines, budgets, and labor markets.
The construction sector, inherently reliant on weather conditions, faces unique vulnerabilities. Project planning, design, and execution are influenced by local climate and geography, making the industry particularly susceptible to weather disruptions. As weather patterns become more erratic and severe, construction firms must adopt strategies to build resilience.
Key Areas Where Weather has Direct Effects on the Construction Industry
Here are four key areas where climate change and extreme weather impact the construction industry today.
1. Labor Shortage
The construction industry continues to grapple with a significant labor shortage, exacerbated by recent events. The COVID-19 pandemic disrupted labor markets globally, causing early retirements and reducing the influx of new workers. According to a 2023 survey by the Associated General Contractors of America, 94% of contracting firms involved in highway and transportation construction are looking for workers, and 91% of those companies are having difficulties filling those positions.
Extreme weather events amplify this challenge. The increased demand for rebuilding infrastructure and homes after disasters strains the already limited workforce. For example, following the 2021 floods in Western Europe, the need for skilled tradespeople like electricians, plumbers, and carpenters surged by an estimated 20% across the affected regions.
Moreover, the rising temperatures and unpredictable weather patterns pose additional challenges for construction crews. Heatwaves in regions like the southwestern United States have led to more frequent work stoppages, reducing overall productivity and exacerbating the labor shortage. In fact, the U.S. Bureau of Labor Statistics documented at least 436 work-related deaths attributed to environmental heat exposure between 2011 and 2021.
Governments, industry bodies, and construction companies are responding to the skilled labor shortage by launching initiatives to enhance training programs and make construction careers more appealing to younger generations. For instance, firms are partnering with technical schools, community colleges, and trade unions to offer apprenticeship and vocational training programs. These courses provide hands-on experience, industry-recognized credentials, and clear pathways to well-paying careers in the skilled trades.
2. Unusual Weather Conditions
Construction firms have traditionally relied on historical weather data to plan projects. However, climate change has rendered many of these patterns obsolete. Recent years have seen unprecedented weather phenomena, such as the 2021 Texas winter storm that caused widespread power outages and disrupted construction activities. In addition to these events, the construction industry has had to navigate through hurricanes, record-breaking heat waves, and unseasonal rainstorms, each bringing unique challenges and risks.
For instance, Hurricane Ida in 2021 caused severe flooding and damage across multiple states, leading to significant delays and increased costs for numerous construction projects. Meanwhile, Europe faced its own trials with extreme heat waves in 2022, where temperatures soared above 40°C (104°F) in countries like Spain and France. Such conditions not only slow down the work pace but also pose serious health risks to construction workers, necessitating more frequent breaks and stringent safety measures.
Predictive technologies, especially AI-driven models, are becoming essential for managing these uncertainties. AI can analyze vast amounts of data to predict weather patterns more accurately and provide early warnings for extreme weather events. This allows construction firms to develop more robust emergency plans and adapt to changing conditions, ensuring projects stay on track despite unexpected weather events.
Beyond merely predicting weather, these technologies can help optimize scheduling and resource allocation. By anticipating periods of extreme heat or heavy rainfall, construction managers can better plan labor deployment and protect sensitive materials from damage.
3. Equipment Damage and Efficacy
Unusual weather conditions can severely affect construction equipment and materials. Extreme heat, for example, can reduce the efficacy of sealants and adhesives, while heavy rainfall can delay projects and damage machinery. The 2022 flooding in parts of Europe highlighted the vulnerability of construction sites to sudden weather changes.
Recent statistics underscore the growing challenge. Adverse weather affects 45% of construction projects globally, leading to billions of dollars in extra costs and lost income for project owners and contractors annually. Furthermore, climate changes are predicted to make such weather conditions more frequent and severe, worsening these delays.
AI technology is revolutionizing equipment maintenance and management. Predictive maintenance algorithms can analyze data from sensors embedded in machinery to forecast potential failures and schedule timely repairs, preventing weather-related damage. AI-driven systems can also optimize the use of materials and equipment, improving efficiency and reducing downtime.
For instance, consider a construction site in Southeast Asia, where monsoon rains are a constant threat. Traditional maintenance methods might struggle to keep up with the frequent downpours. However, with AI-driven predictive maintenance, sensors detect early signs of wear and tear, prompting preemptive repairs. This means equipment is less likely to fail, even in challenging conditions, ensuring that projects continue smoothly.
Moreover, AI systems enhance material usage by predicting optimal conditions for applying adhesives and sealants, which can be particularly sensitive to temperature and humidity fluctuations. By adjusting application times and methods based on real-time weather data, these systems ensure that materials perform at their best, reducing waste and rework.
4. Materials Scarcity
Climate change affects the availability and cost of construction materials. Natural disasters like hurricanes and floods disrupt supply chains, leading to material shortages and price hikes. The global supply chain crisis in 2021, driven partly by extreme weather, resulted in significant delays and increased costs for essential materials like timber and steel.
According to recent data, the situation has worsened. In 2023, the International Federation of Consulting Engineers reported that prices for construction materials had surged by an average of 20% globally, with timber prices climbing by as much as 50% in some regions. This dramatic increase has strained project budgets and timelines, forcing companies to rethink their material procurement strategies.
One notable example is the 2022-2023 floods in eastern Australia, particularly in the Northern Rivers region of New South Wales. These floods severely damaged timber plantations and sawmills, resulting in significant reduction in timber supply from the affected areas in 2023. This disruption led to increased timber prices and shortages, affecting construction and other industries reliant on timber products.
Similarly, extreme heat waves, such as the 2022 heatwave in Europe disrupted steel manufacturing processes. High temperatures compromised the efficiency of blast furnaces and other equipment, reducing steel output. Also, equipment failures due to heat stress can lead to production delays and disruptions.
To address material scarcity, the construction industry is increasingly turning toward sustainable practices. The adoption of recycled materials is gaining momentum, providing viable alternatives that lessen dependence on virgin resources. For example, crushed concrete from demolition sites is now frequently used as a base layer for new road construction, reducing the demand for fresh aggregate.
Building Resilience
Given these challenges, resilience is paramount for the construction industry. Modern construction software plays a crucial role in enhancing project management, communication, and overall efficiency. These tools provide real-time data on financials, scheduling, and resource allocation, enabling firms to adapt quickly to changing circumstances.
For instance, integrated project management platforms offer company-wide transparency, ensuring that all stakeholders have access to critical information. This level of organization allows construction firms to rearrange work schedules, adjust budgets, and ensure worker safety during extreme weather events.
This is where a robust industry-specific ERP, such as CMiC, the leading next generation construction ERP comes in.
CMiC: A Leading Construction-Specific ERP Designed to Optimize Key Operational Processes
CMiC is the leading provider of unified, integrated, and innovative software solutions which are purpose-built for the construction industry. Their suite of solutions is designed to drive integrated project delivery, optimize workflows and heighten office-to-field communications.
CMiC’s ERP is comprised of a vast array of software applications within key product pillars: CMiC Financials and CMiC Project Management. Here is an overview of each of these categories.
CMiC Financials
CMiC Financials helps construction firms manage accounting, human capital and payroll, inventory, and equipment — effortlessly. Through its cutting-edge, industry-specific functionality with proven workflows, CMiC Accounting delivers total visibility of real-time data in complex environments with shifting cost structures — equating to persistently reliable financial reports and projections, from the corporate office to field operations.
Built to manage construction projects, with “layered-in” business intelligence software to help make data-driven decisions in real-time, key applications include Accounting, Human Capital Management and Payroll, Opportunity Management & Resource Planning, as well as Equipment & Inventory Management.
CMiC Project Management
CMiC Project Management software enables teams to collaborate with project stakeholders, control project changes, manage subcontractor tasks, stay on top of material suppliers and simplify the bid process. Key applications in this category include Bidding & Procurement, Construction Documents, Quality & Safety and Project Controls.
From a business benefit perspective, this suite of solutions enables construction firms to complete complex projects with tightly managed costs and timeframes. In addition, managers can track labor productivity, manage labor budgets and payroll, and seamlessly maintain the schedule of field teams.
