##### Energy & Industrials

# 2024 engineering and construction industry outlook

### Sustainable practices and technology advancements are likely to shape the industry in 2024.


ARTICLE • 18MIN
READ


06
NOVEMBER
2023


Deloitte
Research
Center for
Energy &
Industrials


The construction industry entered 2023 marked by a 7% increase in nominal value

added and a 6% increase in nominal gross output compared to the previous year. As1

of the third quarter of 2023, nominal construction spending maintained a steady

upward path. However, if trends in real GDP data continue from 2022, it is2

important to note that much of the topline growth is likely being driven by price

inflation versus volume. In addition to grappling with ongoing inflation, the industry

is facing volatility in material prices and increasing labor costs. Another significant

challenge is the ongoing shortage of skilled labor, which continues to impact the

sector. Moreover, high interest rates and tighter lending standards are also impacting

construction activity.

However, looking ahead to 2024, there could be a boost to construction associated

with manufacturing, transportation infrastructure, and clean energy infrastructure, as

funds from three key pieces of legislation passed in 2021 and 2022—the

Infrastructure Investment and Jobs Act (IIJA), the Inflation Reduction Act (IRA), and

the Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act—are

expected to flow into the industry. As such, construction confidence remains high,3


-----

4

increase in profit margins and staffing levels, particularly in the first half of 2024.

## 2024 energy, resources, & industrials outlooks

#### Read more from the Deloitte Center for Energy & Industrials’ 2024 outlook collection


As E&C firms plan for the upcoming year, there are five key areas that may help

them capitalize on the projected industry growth and tackle unforeseen challenges:

-  Heightened focus on sustainability and efficiency

-  Advancement of digitalization and generative AI

-  Differentiated impact of market uncertainty across the residential and

nonresidential segments

-  Change in operating strategies to manage volatility in costs, demand, and

customer priorities

-  New workforce norms to bridge the lingering talent and skills gap


-----

## 1. E&C firms strive to balance sustainability and efficiency

Sustainability continues to be a business imperative for the construction industry.

E&C companies face a multidimensional challenge on this front as they adapt to

evolving market trends and environmental regulations and meet customer demands

for greener buildings, while also preventing construction costs from accelerating too

rapidly.

According to the International Energy Agency, buildings account for 30% of global

energy consumption and 26% of global energy-related emissions. With the growing5

adoption of efficient building materials and sustainable construction practices, the

industry is expected to be better positioned to accelerate changes and align with the

International Energy Agency’s Net Zero Emissions by 2050 Scenario, which requires

all new buildings and 20% of existing structures to be zero-carbon-ready by 2030.6

According to the US Green Building Council’s 2023 report, sustainability is a top

priority for most surveyed E&C firms as it aligns with their organizational mission


-----

construction materials, passive design principles, and the use of energy-efficient

equipment can accelerate decarbonization by minimizing the overall carbon dioxide

8

emissions associated with both the construction and operation of a building.

The US government is also prioritizing sustainable construction through the Federal

Buy Clean Initiative. For instance, the initiative has led to the specification of more

than US$2 billion for the procurement of lower-carbon construction materials like

asphalt, concrete, and steel for federal procurement and their use in federally funded

projects. It also resulted in the allocation of US$100 million to support state, local

government, and public utility purchases of building products derived from

9

converted carbon emissions.

The IRA incentivizes businesses for energy-efficient improvements such as insulation,

lighting, and heating, ventilation, and air conditioning systems through funding of

10

more than US$1.7 billion on top of additional tax credits. Efficiency—that is,

delivering structures that minimize resource usage while optimizing operational

performance—is likely to become key to sustainable construction. The upfront costs

associated with sustainable construction can be offset by reduced long-term life cycle

costs. Such reductions in costs may be derived from the usage of high-performance

11

facades and energy-efficient systems.

Furthermore, firms can experiment with an array of passive design techniques to

bolster building efficiencies and reduce energy demand. These techniques may include

orienting structures (buildings) to avoid or capture solar heat, designing green roofs

to reduce heat absorption and provide insulation, incorporating energy-efficient

fixtures and daylight-responsive lighting controls to reduce energy consumption, and

designing building envelopes for effective insulation and moisture control to stabilize


12

indoor temperatures. Delivering sustainable structures in a cost-effective manner is

paramount for E&C firms in differentiating themselves in the market and satisfying

customer priorities. E&C companies are likely to continue exploring innovative and

technology-enabled strategies to balance sustainability and efficiency in 2024.

In addition to balancing sustainability with efficiency, the increasing occurrences of

severe weather events such as hurricanes, floods, and wildfires have raised the focus

on resilient design. As highlighted by the US Green Building Council, building


-----

13

address a range of resilience demands. With such new demands on both

sustainability and resilience, the industry is poised to take advantage of an increase in

the development of advanced and emerging materials such as self-healing or high
performance eco-friendly concrete, electrical steel, graphene, and carbon fiber

composites. These new purpose-driven materials are engineered to surpass the

capabilities of naturally occurring materials and offer benefits such as durability,

14

flexibility, circularity, stability, and efficacy. Sustainable materials such as treated


15

wood, low-carbon bricks, and silica fumes may also see an uptick as E&C firms

work to reduce the carbon footprint of new buildings.

Regardless of the method for achieving sustainability, E&C companies are expected

to begin prioritizing sustainable design tactics and structural performance during the

conceptual phase. Such early planning can result in substantial reductions in carbon

16

emissions. E&C companies can also incorporate circular economy principles early

within the design and construction process. Based on these principles, companies

may engage in reusing materials, designing structures for disassembly, and reducing

waste to address environmental concerns and support business growth.

Utilizing technologies and techniques such as optioneering powered by generative

design, simulations, and building information modeling (BIM) can allow companies

to model a building’s performance and carbon footprint, and estimate both cost and

schedule prior to construction, thereby enabling seamless project delivery. These

technologies can also improve efficiency, increase delivery confidence, and hone

resource allocation, ultimately lowering project expenses and risks. Furthermore,

applications of BIM, IoT sensors, data analytics, and energy optimization techniques

can contribute to reducing emissions.

## 2. E&C firms to unlock new value by leveraging digitalization and adopting generative AI

In recent years, the E&C industry has gradually adopted digital technologies to help

improve processes and efficiencies. However, with the rise of generative AI and other

disruptive technologies the sector is now seemingly poised to realize improvements


-----

compliance, and quality assurance.

The Deloitte AI Institute defines generative AI as “a subset of artificial intelligence in

which machines create new content in the form of text, code, voice, images, videos,

17

processes…”

Industry leaders continue to prioritize technology investments, aiming for efficiency

improvements in order to mitigate ongoing workforce, cost, and supply chain


18

challenges. The rise of generative AI could mark a pivotal moment in the industry’s

digital transformation, building on the momentum gained during the pandemic. Both

E&C firms and construction technology companies are actively exploring generative

AI’s potential for enhancing efficiencies and are working on solutions to harness this

19

technology to suit their business needs.

In a recent Deloitte survey, 55% of chief operating officers indicated that the main

barrier to creating business value with artificial intelligence was identifying the right


20

use cases. Additionally, top of mind for E&C firms are concerns around cyber risk,

21

data security, and lack of trust. Developing comprehensive risk mitigation strategies

can help address concerns as companies explore generative AI applications.

Figure 1 presents some use cases that E&C companies could consider leveraging in


22

2024 and beyond. These scenarios illustrate the diverse applications of generative

AI across various construction stages that can help companies achieve benefits such

as cost reduction, enhanced building performance and safety, and greater

sustainability.


-----

While companies experiment with the practical applications of generative AI, they

can continue to accelerate advancements in various other AI and emerging

technologies. These technologies may include drones, autonomous guided vehicles,

robotics, BIM, IoT sensors, and others that are being deployed to help drive value

realization. For instance, with foundational digital technologies already in place,

drones and autonomous guided vehicles could be used in a range of scenarios at

construction sites from inspection and worksite monitoring applications to task

optimization in areas such as material delivery, surveying, and installations.

These emerging technologies and their applications can improve profit margins,

foster stronger partnerships, help relationships between different stakeholders and

functional departments, and improve integrated project delivery through transparent

and trusted data-sharing. E&C firms can leverage advancements in technology not

only for increased productivity but also to explore higher-level opportunities,


-----

23

previously.

It is important to recognize that these technologies depend on human intelligence and

oversight. Regardless of advancements in construction technology, industry leaders

are exploring a human-in-the-loop concept that requires the involvement of highly

skilled individuals to carry out tasks such as fact-checking, in-depth analysis, and

24

understanding the complex details needed for each construction process.

Furthermore, for technology initiatives to gain widespread adoption and scalability,


25

companies should have strong ecosystem alliances and partners, including

technology providers, operations vendors, contractors, and automation vendors,

among others.
## 3. E&C firms to navigate the varied effects of ongoing economic uncertainty

After a year of rising interest rates and high inflation, there has been further

segmentation in the market since last year’s E&C industry outlook. The construction

industry is expected to face the lingering effects of economic uncertainty for yet

another year. The federal funds interest rate recorded a 22-year high in September

26

2023 at 5.3%, and a 108% year-over-year increase. Additionally, the consumer

price index for all urban consumers in US cities increased by 4% year over year in


27

August 2023. Further tightening of monetary policy by the Fed could trigger

28

concerns of an economic downturn, even as inflation cools.

Broader economics, monetary policy, and overall market uncertainty have had varied

impacts across different segments. Total construction spending stood at US$1.98

trillion in August 2023, a 7.4% increase since the previous year. This total spending

was primarily driven by nonresidential construction spending, which recorded

growth at 17.6% year-over-year increase in August 2023. By contrast, residential

construction spending decreased by 3% for the same period, underscoring the overall


29

weakness in the housing market (figure 2).


-----

For the residential segment, the performance of the housing market in 2024 depends

on broader economics. From January to August 2023, total housing starts decreased

by 13% compared to the same period of the previous year largely due to a rise in

30

interest rates and inflation. According to Bureau of Labor Statistics data, housing

inflation in US cities rose to 5.7% year over year in August 2023 and was a

significant contributor to the increase in core consumer price inflation. Given the

segment’s sensitivity to economic cycles, continued high interest and mortgage rates

will likely affect housing affordability, reduce demand, and restrain the segment’s


-----

31

housing construction through the next year.

The nonresidential segment, on the other hand, is likely to continue to grow steadily

as federal funds flow into the construction of chip fabrication plants, biotechnology

facilities, EV battery factories, and other clean energy projects in 2024, and as several

32

high-value projects break ground. Manufacturing construction spending had the

largest annual increase in construction spending of 65.5% as of August 2023.

Manufacturing construction is likely to grow further in 2024, buoyed by funding of

more than US$52 billion from the CHIPS Act and close to US$152 billion from the


33

IRA and IIJA.

Furthermore, with IIJA funds flowing into projects, transportation infrastructure

construction spending increased 9.4% year over year in August 2023. Going into

34

2024, there could be a more prominent impact of IIJA funding, with around

US$58.8 million earmarked for transportation, broadband, climate, and energy


35

construction projects. Substantial infrastructure investments from state and local

36

governments are also likely to drive growth.

Finally, the IRA has also created opportunities for the construction industry through

tax credits and energy incentives for the expansion of clean energy infrastructure,

such as renewable energy generation facilities and electric transmission facilities, with

37

various funding opportunities available through late 2024.

Despite the flow of public funds, market uncertainty will likely influence various

aspects of construction projects in the nonresidential segment. Project deliveries may

be delayed due to financing challenges and disruptions in the supply chain. Margins

could diminish as the cost of materials and labor fluctuates in response to economic

uncertainty. Financing could become more expensive as interest rates fluctuate and

impact the feasibility of certain projects. Finally, backlogs in the segment—which can

help E&C firms sustain operations through economic uncertainties—may be reduced

if ambiguity in timelines and financing of new projects persists in the coming year. As

of August 2023, backlogs in the nonresidential segment had increased to 9.2


38

months and are expected to sustain the segment going into next year.

As companies decide on the necessary next steps to navigate uncertain economic


-----

39

with a total estimated value of completed deals at US$3.7 billion. Many of these

deals are likely aimed at strategic expansion into new markets to better access

additional revenue streams or at horizontal integration to help achieve cost efficiency

and enhance resilience to market fluctuations. The industry also recorded 84 M&A

40

deals from private equity investors, with a total deal value of US$4.5 billion. M&A

activity from private equity investors may increase as they continue to invest in

infrastructure assets and capital projects.

E&C companies will likely need to make strategic decisions based on their

capabilities to overcome ambiguities in the market. Some construction companies

may choose to focus on their core business, deepening their expertise and averting

risk. On the other hand, some may choose to reinvent or expand by making targeted

investments in business transformation and/or new M&A activity to reap greater

rewards when the market regains stability.
## 4. E&C firms likely to be more strategic to navigate persistent cost volatility

US construction firms have been facing significant cost pressures driven in part by

frequent fluctuations in labor costs and material prices in the last few years. Cost

fluctuations can complicate project planning and prompt deliberations over pausing

or terminating projects. Several firms have canceled or changed the scope of their

41

projects due to increasing costs. Managing cost volatility is a top priority for firms


42

and can slow down construction starts if not managed closely.

The average wage rates in construction have been rising steadily. According to BLS

data, average hourly wages increased by 5.2% year over year to US$36.70 in August

2023 and around 17% since the beginning of the pandemic lockdowns in March

43

2020 (figure 3). Construction wages are expected to experience upward pressure in

2024 as labor demand continues to outpace supply. This situation may affect smaller

firms more and render them more vulnerable against larger counterparts capable of

offering competitive salaries to attract talent. Rising wage rates can also have an

impact on project execution and profit margins, especially if the elevated costs cannot

be transferred to clients.


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raw materials in the first few months of 2023 (figure 3). The third quarter of 2023

has once again seen a rise in prices. These prices have not returned to prepandemic

44

price levels, affecting the profitability of many projects. As E&C firms work to

navigate cost volatility, they should consider several keys for pricing:

-  The overall price of construction inputs increased 0.1% year over year in August


2023. Moreover, prices have increased by 40.7% since February 2020.45 46

-  Prices of raw materials such as iron and steel, lumber and wood products,

softwood lumber, and steel mill products declined in August but remain well over

pre-pandemic prices.47

-  Construction machinery and equipment costs increased by 6% year over year in

August, and by over 26% since February 2020. Similarly, concrete products prices

increased by over 8% year over year in August, and by over 32% since February


2020.48


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These price levels could increase the bid prices and project costs, affecting the

profitability of E&C firms. As construction equipment prices increase and as tools

manufacturers continue their recovery from recent supply chain challenges, E&C

companies may increasingly turn to equipment and tools leasing and financing in

2024. Although prices of raw materials could stabilize within the next few months,

machinery and equipment prices are likely to remain high as lead times continue to

prolong deliveries.

In 2024, E&C companies could consider the following operational strategies to help

recover cost increases:


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inconsistent payment terms can impact the company’s financial performance

-  Implementing supply chain strategies such as category management, strategic

supplier contract negotiations, and strategic procurement

-  Applying a disciplined cost/overhead (i.e., operations not charged to customers)

management approach, as backlogs may not remain sustainable

-  Engaging with customers early in the project life cycle for better decision-making

and planning, thereby expediting design choices and enabling advanced

procurement of raw materials

-  Monitoring and analyzing cost data to streamline operations and pinpoint

optimal project types

-  Leveraging prefab and modular construction methods to help keep material costs

down, reduce labor costs, and shorten project schedules, thereby curtailing budget

overruns.

## 5. E&C firms likely to adapt to new work and workforce norms

The E&C industry continues to grapple with filling open workforce positions and is

faced with a significant labor gap. In August 2023, job openings in construction

totaled 350,000, a 1.4% increase year on year and more than 13% higher than

prepandemic levels. At the same time, the quit rate is still higher than the rate of

49

layoffs and discharges—highlighting the voluntary exit of the workforce.

As mentioned in last year’s outlook, the rise of remote work and greater career


50

flexibility contributed to retention issues in the E&C space. It now plays a

significant role in the increasing number of job openings. The ABC recently reported

51

the E&C industry needs more than 342,000 new workers in 2024. The rise of

wages across multiple sectors is driving potential workers to opt for safer, less

physically demanding positions—for example, those in the service and IT


52

industries. Furthermore, the pipeline of workers is diminishing as support for the

53

trades in many high schools has given way to emphasis on computer learning.


-----

meet their commitments. Due to a lack of available qualified candidates, 68% of

54

construction firms surveyed are struggling to fill open positions. In order to meet

the incoming demand for work, 69% of surveyed firms expect to increase headcount


55

in the next year.

Moving from a strategy focused on retention, as outlined in the 2023 outlook, to a

strategy for filling the talent gap created by the above challenges, is further

complicated by a retiring and aging workforce in E&C. Over one-fifth of

construction workers are older than 55 years and often represent the most skilled

workers on a job site. In hiring, firms struggle to find younger workers with

56

comparable skills. An ABC study found that a majority of surveyed executives are

extending their outreach to include high school graduates, community colleges,

veterans, and people who are reentering the workforce. Such outreach programs can

help executives engage both a broader and more diverse workforce.

While the industry has made progress in adapting to the labor shortage, E&C firms

can follow a multipronged approach to shifting their focus from retaining talent to

tapping into and developing leading talent in the coming year:

-  Embrace the “gig economy”: The 2023 outlook found that a flexible and agile

workforce can help E&C companies attract and retain talent. Expanding on that,

many younger workers seem to be drawn to the gig economy, where they can work

as contract employees for multiple employers rather than committing to a single

employer. This approach not only allows firms to tap into a broader pool of talent

but also offers the flexibility many workers seek.

-  Invest in upskilling and cross-skilling programs: Apprenticeship and training

programs can help to meet E&C companies’ talent challenges. ABC reports that

contractors invested US$1.5 billion in workforce development in 2022 benefiting


more than 1.3 million course attendees. Construction firms have increased57

spending on training and professional development and also increased use of online

training programs in the last 12 months to attract talent. Companies can also58

cross-train their employees in other functions and broaden their expertise to create

a flexible, efficient workforce.


-----

on safety can make construction more appealing to potential recruits. Safety

education accounted for most of the total workforce investment in the first half of

2023.59

-  Offer competitive compensation and benefits: Offering competitive wages and

benefits is vital. A higher income potential can help attract a wider talent pool.

Many E&C firms surveyed have increased base pay and bonuses or other

incentives, and initiated employee benefit programs in the last 12 months to retain

and attract top talent.60

-  Take advantage of broader incentives: The IRA tax credits available for

companies who hire registered apprentices may build demand for apprenticeship

programs, potentially expanding workforce training opportunities and benefitting

employers.

-  Leverage robotics, automation, and other cutting-edge tools: Robotics and

automation can help in reducing or removing human workforce from high-risk and

exposed areas. It can also minimize reliance on specific job roles and can help

cross-skill other workers (e.g., carpenters doing layout designing by using robotic

solutions). Technology-driven solutions enhance efficiency and collaboration.

Additionally, adoption of technology can make the industry more appealing to a

tech-savvy younger generation. Two in three construction firms surveyed agree that


the use of cutting-edge tools helps them recruit talent. Several firms also agreed61

that AI and robotics will improve safety and productivity of the workforce.62

-  Boost diversity, equity, and inclusion in hiring: This trend from last year’s

outlook remains highly relevant, as hiring a diverse workforce and attracting

prospective employees from new sources of talent, including veterans, persons with

disabilities, and returning workers, in addition to women and underrepresented

ethnic groups, will widen the talent pool. Diversity is an important driver of

innovation and success. About 77% of construction firms believe that diversifying


their workforce is crucial for their future business.63


-----

## Looking into the future: Agility and adaptability founded on digital transformation could be key for industry competitiveness

The E&C industry has demonstrated strong resilience in the face of persistent

pressure and economic fluctuations. As we move into 2024, the growing focus on

sustainability and efficiency, even amid economic uncertainty, emphasizes the

importance of agility and adaptability. E&C companies can remain nimble through

the continued adoption of new technologies, analytical methods, and the engagement

of a broader workforce. Digital transformation can help E&C companies develop

new synergies while improving efficiency, reducing emissions and waste, decreasing

costs, generating new value streams, and enhancing talent and program management.

Leveraging cutting-edge technologies, such as generative AI, can provide a

competitive advantage to E&C firms in 2024. Furthermore, E&C companies can

compete on both cost and revenue by accessing government incentives offered by the

IRA, IIJA funding streams likely to hit the market in 2024, or both. Finally, E&C

firms should continue to embrace change, not merely as a response to external

pressures but as a strategic imperative to better thrive in an uncertain macroeconomic

environment.

In the coming year, E&C companies may add the following to their strategy

playbook for navigating uncertainty, strengthen competitiveness, and take advantage

of the opportunity at hand:

1. Focus on the economics of sustainable construction with the usage of high
performance building materials and energy-efficient systems.

2. Continue to invest in a digital foundation with BIM and robotics and explore

applications of emerging technologies, such as generative AI, to enhance

efficiency.

3. Leverage data-driven insights for better decision-making and safeguarding

financial performance.


-----

as well as in automation tools, worker safety, and expanded DEI representation

in hiring.

## Access the archive

[2023 engineering and construction industry outlook](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-eri-outlook-engineering-and-construction-2023.pdf)

[2022 engineering and construction industry outlook](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-2022-outlook-engineering-and-construction.pdf)

[2021 engineering and construction industry outlook](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-2021-engineering-construction-industry-outlook.pdf)

[Midyear 2020 engineering and construction industry outlook](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-2020-engineering-construction-midyear-industry-outlook.pdf)

[2020 engineering and construction industry outlook](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-2020-engineering-construction-outlook.pdf)

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**BY** **Michelle Meisels**
United States

**Kate Hardin**
United States

**Kruttika Dwivedi**
India


**Misha Nikulin**
United States

**Matt Sloane**
United States


-----

1. Deloitte analysis of data from U.S. Bureau of Economic Analysis.

View in Article

2. Deloitte analysis of data from U.S. Census Bureau.

View in Article

[3. Heather Boushey, “The economics of public investment crowding in private](https://www.whitehouse.gov/briefing-room/blog/2023/08/16/the-economics-of-public-investment-crowding-in-private-investment/)

[investment,” The White House, August 16, 2023.](https://www.whitehouse.gov/briefing-room/blog/2023/08/16/the-economics-of-public-investment-crowding-in-private-investment/)

View in Article

[4. Associated Builders and Contractors, “ABC’s construction backlog indicator](https://www.abc.org/News-Media/News-Releases/abcs-construction-backlog-indicator-steady-in-august-contractors-remain-confident)

[steady in August, contractors remain confident,” news release, September 12,](https://www.abc.org/News-Media/News-Releases/abcs-construction-backlog-indicator-steady-in-august-contractors-remain-confident)
2023.

View in Article

[5. International Energy Agency, “Buildings,” accessed October 6, 2023.](https://www.iea.org/energy-system/buildings)

View in Article

6. Ibid.

View in Article

[7. U.S. Green Building Council, Green building trends and sentiments, June](https://www.usgbc.org/sites/default/files/2023-06/2023-USGBC_Green-Building-Trends.pdf)

2023.

View in Article

[8. Larry Strain, “10 steps to reducing embodied carbon,” The American Institute](https://www.aia.org/articles/70446-ten-steps-to-reducing-embodied-carbon)

of Architects, accessed October 6. 2023.

View in Article

[9. Office of the Federal Chief Sustainability Officer, “Federal buy clean initiative,”](https://www.sustainability.gov/buyclean/)

accessed October 6, 2023.

View in Article


-----

_[Inflation Reduction Act’s investments in clean energy and climate action,](https://www.whitehouse.gov/wp-content/uploads/2022/12/Inflation-Reduction-Act-Guidebook.pdf)_
January 2023.

View in Article

[11. Michelle Meisels, Faisal Yousuf, and Aijaz Hussain, “Sustainable buildings:](https://www2.deloitte.com/us/en/pages/energy-and-resources/articles/delivering-sustainable-construction.html)

[Designing, building, and operating to help create a greener future,” Deloitte,](https://www2.deloitte.com/us/en/pages/energy-and-resources/articles/delivering-sustainable-construction.html)
2023.

View in Article

12. Ibid.

View in Article

[13. U.S. Green Building Council, Green building trends and sentiments.](https://www.usgbc.org/sites/default/files/2023-06/2023-USGBC_Green-Building-Trends.pdf)

View in Article

[14. David Yankovitz, Robert Kumpf, Kate Hardin, and Ashlee Christian, The](https://www2.deloitte.com/us/en/insights/industry/oil-and-gas/the-future-of-materials.html)

_[future of materials, Deloitte Insights, June 2, 2023.](https://www2.deloitte.com/us/en/insights/industry/oil-and-gas/the-future-of-materials.html)_

View in Article

[15. StartUs Insights, “Explore the 10 leading circular economy examples in 2024,”](https://www.startus-insights.com/innovators-guide/tag/construction/)

accessed October 6, 2023.

View in Article

[16. Natalie Terrill, “How the integrated process can make decarbonization easier,”](https://www.usgbc.org/articles/how-integrated-process-can-make-decarbonization-easier)

U.S. Green Building Council, February 24, 2023.

View in Article

[17. Deloitte, Generative AI is all the rage, 2023.](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/deloitte-analytics/us-ai-institute-gen-ai-for-enterprises.pdf)

View in Article

[18. Deloitte, “Global powers of construction 2022,” July 2023.](https://www.deloitte.com/global/en/Industries/energy/perspectives/deloitte-global-powers-of-construction.html)

View in Article


-----

[hard hat?,” MarketScale, March 1, 2023; World Construction Network,](https://marketscale.com/industries/engineering-and-construction/generative-ai-could-reshape-construction-is-it-time-to-get-ai-a-hard-hat/)
[“Leading construction companies in the artificial intelligence theme,” March](https://www.worldconstructionnetwork.com/data-insights/top-ranked-construction-companies-in-artificial-intelligence/?cf-view)
22, 2023.

View in Article

[20. Deloitte, Winter 2023 Fortune/Deloitte CEO Survey, 2023.](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/US-Winter-2023-Fortune-Deloitte-CEO%20Survey-Infographic-FINAL.pdf)

View in Article

21. Ibid.

View in Article

[22. Deloitte, “Generative AI use case repository,” September 14, 2023.](https://resources.deloitte.com/sites/global/Services/generative-ai/Pages/Generative-AI-Dossier.aspx)

View in Article

[23. Deloitte, Generative AI is all the rage.](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/deloitte-analytics/us-ai-institute-gen-ai-for-enterprises.pdf)

View in Article

[24. Russell Haworth, “Generative AI in the construction sector: Taking building](https://www.forbes.com/sites/forbesbooksauthors/2023/05/02/generative-ai-in-the-construction-sector-taking-building-technology-to-new-heights/?sh=33ac25b96ee8)

[technology to new heights,” Forbes, May 2, 2023.](https://www.forbes.com/sites/forbesbooksauthors/2023/05/02/generative-ai-in-the-construction-sector-taking-building-technology-to-new-heights/?sh=33ac25b96ee8)

View in Article

[25. Deloitte AI Institute, A new frontier in artificial intelligence, 2023.](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/deloitte-analytics/us-ai-institute-generative-artificial-intelligence.pdf)

View in Article

26. Deloitte analysis of data from Federal Reserve Bank of St. Louis.

View in Article

27. Deloitte analysis of data from U.S. Bureau of Labor Statistics.

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[28. Daniel Bachman, United States Economic Forecast, Deloitte Insights,](https://www2.deloitte.com/us/en/insights/economy/us-economic-forecast/united-states-outlook-analysis.html)

September 2023.

View in Article


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30. Ibid.

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[31. Bachman, United States Economic Forecast.](https://www2.deloitte.com/us/en/insights/economy/us-economic-forecast/united-states-outlook-analysis.html)

View in Article

[32. Sebastian Obando and Julia Himmel, “Construction’s manufacturing boom:](https://www.constructiondive.com/news/manufacturing-construction-boom-tracker-map/688140/)

[Mapping the biggest facilities underway in the US,” Construction Dive, August](https://www.constructiondive.com/news/manufacturing-construction-boom-tracker-map/688140/)
7, 2023.

View in Article

[33. U.S. Department of Energy, “Building America's clean energy future,” accessed](https://www.energy.gov/invest)

October 6, 2023.

View in Article

[34. Julie Strupp, “IIJA money starting to flow to projects,” Construction Dive,](https://www.constructiondive.com/news/iija-infrastructure-act-money-start-to-flow-construction-projects/643721/)

February 28, 2023.

View in Article

35. Deloitte analysis of data from the General Services Administration.

View in Article

[36. Strupp, “IIJA money starting to flow to projects.”](https://www.constructiondive.com/news/iija-infrastructure-act-money-start-to-flow-construction-projects/643721/)

View in Article

[37. The White House, Building a clean energy economy.](https://www.whitehouse.gov/wp-content/uploads/2022/12/Inflation-Reduction-Act-Guidebook.pdf)

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38. Deloitte analysis of data from Associated Builders and Contractors.

View in Article

39. Deloitte analysis of data from Mergermarket.

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-----

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[41. Associated General Contractors of America, 2023 workforce survey results,](https://www.agc.org/sites/default/files/Files/Communications/2023_Workforce_Survey_National_Final.pdf)

2023.

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[42. Emell Adolphus and Jonathan Keller, “ENR's 2023 top 400 contractors:](https://www.enr.com/articles/56502-enrs-2023-top-400-contractors-uncertainty-looms-over-market)

[Uncertainty looms over market,” Engineering News Record, June 5, 2023.](https://www.enr.com/articles/56502-enrs-2023-top-400-contractors-uncertainty-looms-over-market)

View in Article

43. Deloitte analysis of data from U.S. Bureau of Labor Statistics.

View in Article

[44. Deloitte, Global powers of construction 2022, July 2023.](https://www.deloitte.com/global/en/Industries/energy/perspectives/deloitte-global-powers-of-construction.html)

View in Article

[45. U.S. Bureau of Labor Statistics, PPI detailed report, August 11, 2023.](https://www.bls.gov/ppi/detailed-report/ppi-detailed-report-july-2023.pdf)

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46. Ibid.

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47. Ibid.

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48. Ibid.

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49. Deloitte analysis of data from U.S. Bureau of Labor Statistics.

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[50. Deloitte, 2023 engineering and construction industry outlook, November](https://www2.deloitte.com/us/en/pages/energy-and-resources/articles/engineering-and-construction-industry-trends.html)

2023.


-----

[half a million in 2023, says ABC,” news release, February 3, 2023.](https://www.abc.org/News-Media/News-Releases/construction-workforce-shortage-tops-half-a-million-in-2023-says-abc)

View in Article

[52. Zachary Phillips, “Construction has happiest workers of any industry,”](https://www.constructiondive.com/news/happiest-workers-construction-job-recommendation/695436/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202023-10-03%20Construction%20Dive%20Newsletter%20%5Bissue:55083%5D&utm_term=Construction%20Dive)

Construction Dive, October 3, 2023.

View in Article

[53. Mary Yang, “Where did the workers go? Construction jobs are plentiful, but](https://www.npr.org/2023/04/06/1158576556/where-did-the-workers-go-construction-jobs-are-plentiful-but-workers-are-scarce)

[workers are scarce,” NPR, April 6, 2023.](https://www.npr.org/2023/04/06/1158576556/where-did-the-workers-go-construction-jobs-are-plentiful-but-workers-are-scarce)

View in Article

[54. AGC, 2023 workforce survey results.](https://www.agc.org/sites/default/files/Files/Communications/2023_Workforce_Survey_National_Final.pdf)

View in Article

55. Ibid.

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[56. Bob Tita, “Construction industry has work, needs more workers,” Wall Street](https://www.wsj.com/articles/construction-industry-has-work-needs-more-workers-da763703?ns=prod/accounts-wsj)

_Journal, April 10, 2023._

View in Article

[57. Associated Builders and Contractors, ABC 2023 workforce development](https://www.abc.org/Portals/1/FMI-ABC%202023%20Member%20Workforce%20Development%20Survey%20-%20External%20-%20Final.pdf?ver=qls0kVE6wOfbNIf_dnsbqQ%3d%3d)

_[survey, June 2023.](https://www.abc.org/Portals/1/FMI-ABC%202023%20Member%20Workforce%20Development%20Survey%20-%20External%20-%20Final.pdf?ver=qls0kVE6wOfbNIf_dnsbqQ%3d%3d)_

View in Article

[58. AGC, 2023 workforce survey results.](https://www.agc.org/sites/default/files/Files/Communications/2023_Workforce_Survey_National_Final.pdf)

View in Article

[59. ABC, ABC 2023 workforce development survey.](https://www.abc.org/Portals/1/FMI-ABC%202023%20Member%20Workforce%20Development%20Survey%20-%20External%20-%20Final.pdf?ver=qls0kVE6wOfbNIf_dnsbqQ%3d%3d)

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[60. AGC, 2023 workforce survey results.](https://www.agc.org/sites/default/files/Files/Communications/2023_Workforce_Survey_National_Final.pdf)

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62. Ibid.

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63. Ibid.

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**Acknowledgments**

The authors would like to thank Anuradha Joshi who provided research and

analysis expertise in the development of this report.

The authors would also like to thank Sami Alami, Heather Ashton Manolian, Patricia

**Henderson, Lisa Iliff, Samuel Freeman, Julia Tavlas, and Danny Bachman for their**

subject matter input and review.

The authors would like to acknowledge the support of Clayton Wilkerson for

orchestrating resources related to the report; Kimberly Prauda and Neelu Rajput

who drove the marketing strategy and related assets to bring the story to life;

**Alyssa Weir for her leadership in public relations; and Pubali Dey and Rithu Thomas**

from the Deloitte Insights team who supported the report’s publication.

Cover image by: Rahul B


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