“If you want to build a ship, don’t drum up the men to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.”

– Antoine de Saint-Exupéry

This quote caught my attention because it perfectly describes the world we live in today. It seems like everywhere we turn, there's always a new project to work on or a goal to meet. What's even more disheartening is that the leaders who guide us through these projects often lack the passion and enthusiasm that could truly bring us together.

It's a sad truth, but the reality is that a large majority of the companies we work for are solely focused on making their owners rich. We, the hardworking employees, are left with nothing more than a paycheck at the end of the day. It's no wonder there's so much emphasis on "teamwork" these days. It's almost like it's a way to distract us from the fact that we're just cogs in a machine, yearning for something more meaningful.

But let me tell you, there's something truly special about working together as a team. It's like sailing on a vast and endless sea, where the possibilities are limitless. When we come together with a shared purpose and genuine passion, we can achieve incredible things. So let's not settle for mediocrity and let's not let our hearts be overshadowed by the profit-driven motives of others. Instead, let's embrace the power of teamwork and set sail towards a brighter future, where our collective efforts can make a real difference.

— Wayne Jensen

Presented by: Wannemacher Jensen Architects, Inc.

DIG INTO THIS ONE

Did you know, for example, that 20 percent of customers account for 80 percent of revenues? That 20 percent of our time accounts for 80 percent of the work we accomplish. The 80/20 Principle shows how we can achieve much more with much less effort, time, and resources, simply by identifying and focusing our efforts on the 20 percent that counts. Although the 80/20 principle has long influenced today's business world, author Richard Koch reveals how the principle works and shows how we can use it systematically and practically to vastly increase our effectiveness, and improve our careers and our companies.

IN THE NEWS

Prominent Road Construction Company Embroiled in Bold Sexual Harassment Lawsuit

Balfour Beatty is being sued by the EEOC after a female employee reported long-term sexual harassment and was ignored. The lawsuit alleges that the victim was harassed by multiple male coworkers, including explicit requests and messages. The foreman did nothing to stop the abuse, and the harassment escalated. The victim faced derogatory comments and retaliation when she complained. The EEOC seeks monetary relief and injunctive relief to end discrimination. This behavior is not uncommon in the construction industry and needs to change to support workforce recovery efforts. The EEOC has investigated similar incidents in the industry and is committed to promoting equal opportunity. Employers must protect women from abuse and discrimination in the workplace.

The USDOT has swiftly taken action by allocating a substantial $3 million to address the dire state of roads ravaged by the catastrophic Hawaii fire disaster

The U.S. Department of Transportation's Federal Highway Administration (FHWA) has announced the immediate availability of emergency relief funds for infrastructure repairs and management services on Maui. Wildfires on August 8, 2023, resulted in loss of life and extensive damage to the community in Lahaina. President Joe Biden declared a major disaster zone in Hawaii and committed federal aid. The $3 million requested by the Hawaii Department of Transportation (HDOT) will be used for traffic management services and repairs. The funds will cover portable traffic signals, erosion control, signs, guardrails, jersey barriers, and police traffic management services. U.S. Transportation Secretary Pete Buttigieg expressed support for Maui's rebuilding efforts. The FHWA will continue to work closely with HDOT to provide necessary support. The quick-release funding is an initial installment to restore essential infrastructure. Additional aid will be available through the Emergency Relief national funding allocations. The program encourages better resiliency in infrastructure designs to withstand future disasters caused by climate change or unforeseen events.

The Department of Labor's Final Ruling: A Game-Changer for Road Builders

The Davis-Bacon Act has been updated after 40 years with input from labor groups, advocates, and industry stakeholders. The changes, announced on August 8, 2023, will go into effect 60 days later and are the most comprehensive in almost four decades. These updates impact the administration and enforcement of labor standards for Federal and federally subsidized construction projects, including highway projects. The goal is to ensure fair wages and benefits for workers and create opportunities for more families to enter the middle class. The new rules significantly change how the "prevailing wage rate" is determined and enforced, particularly for flaggers, material suppliers, and truck drivers in the asphalt and road building industry. The prevailing wage rate is calculated based on the majority wage rate in a classification, or the rate earned by the greatest number of workers if there is no majority. These changes benefit both laborers and employers, improving workers' quality of life while potentially attracting more job seekers to the industry. The updates also enhance the Department of Labor's ability to administer and enforce labor standards, including periodic updates to prevailing wage rates, adopting state or local wage determinations, issuing supplemental rates, and strengthening worker protections and enforcement measures.

Exciting Shift in Labor Regulations to Revolutionize Road Construction Wages

The Davis-Bacon Act is being updated after 40 years with input from labor groups, advocates, and industry stakeholders. The changes will have immediate impacts on the road building and asphalt industry. The Department of Labor announced a Notice of Proposed Rulemaking on March 18, 2022, starting a year-and-a-half-long process to modernize the Davis-Bacon and Related Acts. The updates, which go into effect on Aug. 8, 2023, are the most comprehensive in almost four decades. The final ruling includes major changes to labor standards for Federal and federally subsidized construction projects, including federally funded highway projects. The new rules significantly alter how the "prevailing wage rate" is determined and enforced. Specifically, three areas of focus impact the asphalt and road building industry: "site of work" flaggers, material suppliers, and truck drivers. The regulations establish clear guidelines for when truck drivers must be paid the prevailing wage rate. Flaggers are now considered part of the project if they are "virtually adjacent" to the main work site. The prevailing wage rate is determined by the majority wage rate in a classification, or the rate earned by the greatest number of workers if there is no majority. These changes benefit both laborers and employers, but may also attract more job seekers to the industry. The final rule also improves the administration and enforcement of DBRA labor standards, including updating prevailing wage rates, adopting state or local wage determinations, issuing supplemental rates, reflecting modern construction practices, and strengthening worker protections and enforcement.

NTI's New Program Aims to Grow Construction Workforce

The National Technical Institute has launched the Regional Immersion Program to expand the trained trade workforce. The program offers online courses that can be completed in as little as nine weeks, introducing students to the fundamentals of their respective trades. The program aims to help contractors in the recruiting process and address the worker shortage. It allows for a diverse range of individuals to complete virtual instruction followed by four days of intensive in-person training. The program provides an opportunity for contractors to overcome recruitment hurdles and secure a qualified workforce. After completing online tutorials, students attend concentrated lab sessions to reinforce their learning. The in-person training is held once a month at NTI's campuses in Phoenix, Las Vegas, or Houston. The program has proven to be valuable for companies, expanding their talent pool and leading to remarkable productivity and revenue growth. Graduates will be prepared for entry-level careers as HVAC, plumbing, or electrical technicians. The program has already trained 50 successful new employees for companies nationwide. It provides an opportunity for contractors to upskill new workers and fill the thousands of available jobs in the industry.

DRIVE PROFIT

The Future of Construction Economy: A Bold Outlook

Construction business owners should expect high prices and monitor their balance sheets in Q4 2023 and Q1 2024. The Penetration Index for rented equipment in the US is approaching 60% and is expected to increase further. The constant discussion about the economy, interest rates, inflation, and the transition to electric vehicles can make it difficult for business management to plan effectively. Business owners need to provide direction and guidance for their company's future. Planning for positive cash flow is crucial, as budgets and net income alone do not guarantee financial stability. Inflation has caused prices to rise, and it is unlikely that they will return to pre-pandemic levels. Cash flow budgets should account for these higher prices. OEMs and sellers are reluctant to reduce prices unless market conditions force them to do so. Inflation has also led to a delay in retirement for some workers, which may present opportunities for contractors seeking additional help. Maintaining a healthy balance sheet and avoiding fixed-cost obligations is essential, especially with rising interest rates and an uncertain economic forecast. Rental equipment is becoming increasingly popular, and there are resources available to help manage rental costs. The push for electric vehicles may not be financially viable for all businesses due to high costs and borrowing rates. Obtaining loans at reasonable rates with favorable covenants is becoming more challenging. It is advisable to defer additional debt and fixed-cost obligations in the current economic climate. Contractors should prioritize generating positive cash flow and regularly review cash flow statements. Operating on a free cash flow basis can inform equipment purchase decisions and maximize the value of the company.

DIRECTION OF THE BUSINESS

AI is revolutionizing the construction industry, propelling it forward with unparalleled efficiencies

As firms wholeheartedly embrace the power of automation, upskilling becomes an absolute necessity. The construction industry, in particular, must step up and offer comprehensive training and development opportunities to its employees, empowering them to expand their technical prowess. With the advent of AI-driven tools and software, the construction sector is experiencing an unprecedented surge in growth, as workflows are automated and financial operations are modernized. These cutting-edge capabilities bring forth a multitude of benefits, including enhanced visibility, expedited payments, and fortified collaboration. By implementing effective data management strategies and leveraging automated platforms, financial control is bolstered, and project optimization is achieved. Moreover, AI plays a pivotal role in identifying potential risks and ensuring unwavering regulatory compliance.

In the face of worker shortages, technology emerges as a formidable ally, with AI poised to potentially replace a staggering 30% of work hours by 2030. By liberating staff from mundane manual tasks, automation grants them the freedom to concentrate on strategic endeavors that drive the industry forward. Furthermore, AI-driven tools seamlessly streamline financial processes, facilitating faster payments and fostering stronger relationships with suppliers. The construction industry, armed with these transformative advancements, has the remarkable potential to augment its value by a staggering $1.6 trillion annually, simply by bridging the productivity gap. To realize this extraordinary feat, upskilling takes center stage, demanding that the industry wholeheartedly invest in training and development opportunities for its workforce, enabling them to thrive in an automated workplace.

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