What is the Commercial Construction Forecast for 2020?

What is the Commercial Construction Forecast for 2020?

For the remainder of 2019, there is a projected 4% increase in nonresidential building construction. Why will there be an upsurge in development? Two contributing factors are the ease of doing business and the introduction of innovative technologies.

For 2020, however, what will be the commercial construction forecast? The American Institute of Architects is projecting an optimistic estimate of more than a 2% increase in construction.

However, an economic downturn in 2020 will increase labor costs as well as the prices of construction materials like iron, steel, and lumber. Moreover, the imposition of trade tariffs will dampen business and slow down spending.

What is the breakdown of commercial construction?

According to dollars spent, construction for 2019 was broken down into the following businesses:

  • Lodging – 7%
  • Office – 15%
  • Shopping – 17%
  • Health care – 8%
  • Education – 5%
  • Recreation – 3%
  • Transportation – 4%
  • Communication – 5%
  • Energy – 21%
  • Manufacturing – 15%

For the year 2020, the forecast does not mention any projected changes.

What changes should we expect in the future?

Technological changes

Cloud-based software solutions exist for every phase of the construction project – from preconstruction, scheduling, project management, and field reporting. Real-time updates are improving collaboration and communication.

Moreover, construction software is getting integrated and more affordable. Functions for bidding, estimating, scheduling, billing, project management, and other essential features are now bundled together as one software solution.

With mobile technology, data is collected and transmitted to the back office. Timecards, expense claims, requests for information submissions are in real-time. Having these apps save long hours spent in entering data and organizing data files.

Offsite construction

Offsite construction is called the “assembly plant method” of development. Under prefabricated construction, components are built offsite and transported to the construction site for assembly or installation.


Small aerial vehicles are equipped with cameras to reach remote locations, do safety inspections, and capture pictures of the project’s progress.

Reduction of the labor force

There is a growing shortage of skilled construction labor. Immigrant labor is expected to reduce further.

Builders will need to focus on the training and development of workers. Otherwise, there will be delays in schedules.

Improvement in safety equipment

As a way of counteracting accidents and deaths, there are “smart” work boots to spot workers who have fallen or slowed down due to fatigue. Boots come equipped with GPS transmitters.

An improvement in cooling vests and moisture-wicking fabrics will also help in reducing accidents. Drones can also alert supervisors to problems on the job site.

Building Information Modeling (BIM)

BIM is a technique to create digital representations of buildings and roads. Architects and engineers analyze these files to predict job costs and to check how building structures will hold up over time.

Using e-commerce for building materials

Builders are now using e-commerce to buy, sell, and rent used and surplus construction materials and equipment. With this approach, transactions are faster, and price comparisons will lower costs.

As a result, there will be a significant reduction in the project timeline. Whatever is the commercial construction forecast, business leaders need the advice of management consulting firms to mitigate the risks of the volatile construction industry. Collaboration with the government is becoming more critical since governments initiate real estate development.

Businesses should also be ready to face risks caused by climate change and political upheavals.


0 responses to “What is the Commercial Construction Forecast for 2020?”

Leave a Reply

Your email address will not be published. Required fields are marked *