Myth Busters Series: Construction Technology

It is time to dispel some of the biggest myths in the construction industry. In the next few weeks, we will look at some common assumptions made about the use and adoption of technology in the construction industry, and we will look at the hard numbers to determine if the common assumptions are in fact true or false. Today, let’s start with one of the most common assumptions: Is the construction industry a laggard when it comes to technology adoption?

Let’s start by considering some 2023 research from McKinsey & Co., which starts by saying, at $12 trillion, the AEC (architecture, engineering, and construction) industry is one of the biggest industries in the world, but historically it has been among the slowest to digitize and innovate—but that it is all beginning to change.

The analyst firm suggests there was an estimated $50 billion invested in AEC tech between 2020 and 2022, which is 85% higher than the previous three years. During the same period, the number of deals in the industry increased by 30%. Certainly, these numbers suggest a big jump in adoption, although it is slower compared to other industries like logistics, manufacturing, and agriculture. Overall, these numbers suggest the pace of change is speeding up in ALL industries, although when compared to other industries construction is slower.

There are a few reasons for slower adoption, namely fragmentation among AEC, low IT spend, and a culture of analog ways of working. So, we see here, that yes, compared to other industries, AEC may be slower to adopt, but the industry itself is not standing still. The pace of change has accelerated in the past three years and looking to the future, trends suggest it will only continue to pick up speed.

The Deloitte 2025 Engineering and Construction Industry Outlook suggests there are reasons to be optimistic about the year ahead. The analyst firm also projects we will continue to see the rise of technology, such as AI (artificial intelligence) in the year ahead. In fact, these tools will augment workforce productivity by helping workers focus on high-value tasks.

The research from Deloitte shows some construction companies are already leveraging technologies such as cloud computing, the IoT (Internet of Things), 5G and private cellular networks, and AI in their operations. What comes next is a greater emphasis on scaling technology opportunities. This could include everything from new opportunities in the back office to project delivery and connected construction, digital twin, and elevating BIM (building information modeling).

Moving into 2025, companies should consider techniques to harness and analyze data to help make better decisions for future designs and project delivery.

What we see here—and know from years of reporting—is that construction is often slower to adopt new technologies when compared to other industries, but it is not standing still. The industry is in fact moving forward with things like BIM, digital twins, robotics, and automation, just to name a few. It is hard for the industry to completely stand still when many companies need to improve safety and productivity. What are your thoughts? Is construction a technology laggard?

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