Category: Construction

6 Steps to Building Safer Construction Sites

Construction sites are dangerous places. Safety hazards lurk around every corner. This is evident by the high rate of occupational fatalities and injuries that occur each year in construction. Falls, electrocutions, heavy equipment rollovers, and collapsing scaffolding are just a small number of ways workers can be seriously injured or killed on a construction site.

The Construction Industry’s Rocky Road to Recovery

We’re a little over a year and a half into the COVID-19 pandemic and the construction industry, like many other industries, is maneuvering several obstacles on its road to recovery. I think it’s important that we take time to understand what this means in the immediate and for the long-term.

Did you miss our previous article…

Stock Markets Drop Their Bravado in November

The DJI, S&P 500, NASDAQ, and TSX have been setting new record highs in each successive month on a regular basis since the early days of the pandemic. Nor did November fail to deliver success on that score once again. In the latest month, new peaks were established by the four major indices.

Did you miss our previous article…

30+ Construction Industry Statistics for EMEA

Construction industry statistics and data are increasingly important as they help accelerate decision-making on and off the construction site.

Seventy-five percent of global construction industry stakeholders agree or strongly agree that the need for real-time decision-making is increasing at the project level. Data is the secret sauce to making those decisions quickly and strategically. It provides contextual information needed to move projects forward in the short term while offering a competitive advantage long-term.

And while project data is ideal for decisions in the present, relevant industry statistics can light a path in the dark for future decisions. Industry trends, both near and farsighted, are likely to impact your approach to preconstruction, technology investments, sustainability, risk analysis, workforce planning, budgeting, operational efficiency, and the list goes on. Add to that the compounding effect of the Covid-19 pandemic, which has served as both a significant challenge and powerful catalyst for growth in digital collaboration.

With these factors in mind, we’ve compiled a list of essential EMEA construction industry stats to help you better understand the landscape. These data points portray the current state of affairs while also forecasting what’s to come. We cover a several major themes, and if you’d like to dive deeper, we’ve also included to each of our sources so you can explore further.

These construction industry stats provide insight into:

  • The current state of the industry at the global and EMEA-specific levels
  • The fastest-growing sectors and areas of demand
  • Current supply chain constraints, sustainability efforts, and workforce outlooks
  • How a formal data strategy fits into addressing the listed challenges and opportunities


See statistics by topic:

General Outlook

  • State of the industry
  • Growth opportunities

Operational Challenges

  • Supply chain
  • Material costs

Sustainability Efforts

  • Commitments and challenges
  • Impact of technology on sustainability

Workforce Statistics

  • Labor shortages and the impact of Brexit 
  • New approaches create new jobs

Rise of Technology

  • The growing market for digitalisation
  • Data strategy brings a competitive edge


State of the industry

  • €11.6/£9.9* trillion estimated in global construction output by 2025. [Oxford Economics]
  • Spending on construction accounted for 13% of the global GDP in 2020; it’s expected to reach over 13.5% in 2030. [Oxford Economics]
  • The European Union’s (EU) total investment in construction in 2020 was €1.4 trillion or 10.7% of the EU’s GDP (€13.2 trillion). [FIEC]
  • The European construction industry is expected to record a Compound Annual Growth Rate (CAGR) of 7.8% to reach €2.4/£2* trillion by 2024. [Cision]
  • The United Kingdom (UK) is predicted to overtake Germany in 2023 in global output. The UK will remain the sixth-largest market after being overtaken by Indonesia in 2024.  [Oxford Economics]


Growth opportunities

  • The fastest-growing sector between 2020 and 2025 is forecasted to be infrastructure. The annual growth is expected to be 5.1% due to unprecedented levels of government stimulus driving medium-term growth. [Oxford Economics]
  • Excess household savings (due to the pandemic) have led to an EU GDP expansion by an 8.5% annualized rate. [Oxford Economics]
  • The demand for residential property is strong in Germany as a result of lowered mortgage interest rates due to COVID-19. As of Q2 2021, German banks have seen sales growth up to 30% compared to 2019. [ConsTrack360]
  • The residential sector is the largest subsector driving short-term growth. It accounted for 44% of total global construction in 2020. [Oxford Economics]


Supply chain constraints and disruptions

Top Construction Industry Statistics for EMEA

  • Fifteen percent of EU contractors indicate lower production due to a lack or delayed delivery of building materials. [ING]
  • As of 12 November 2021, the average cost of shipping a 40-ft container across major trade routes year-to-date (04/11/21) is €6,373/ £5,436* per 40-ft container. This figure is €4,108/£3504* higher than the five-year average of €2,265/£1,932* per 40-ft container. Peak costs exceeded €8,738/£7,454* per 40-ft container (as of November 2021).  [Drewry]
  • Forty-four percent of construction companies in Germany reported problems procuring materials on time, up from less than 6% in March (as surveyed by the Ifo Institute in May). [Financial Times]
  • Production in the German construction industry fell 4.3% in April from the previous month, despite companies in the sector reporting a record order backlog of €62 billion in March. [Financial Times]


Material costs

  • In Q1 2021, the cost of construction materials in Europe rose by the fastest rate since 2004. In July 2021, 40% of concrete, cement, and brick suppliers said they expected to raise their prices even higher. [ING]
  • Concrete rebar (59% higher than a year ago), fabricated steel (65% higher), and imported plywood (82% higher) show the strongest price growth in September 2021 compared to 12 months prior. [BEIS via Euroconstruct]


Sustainability commitments and challenges

Top Construction Industry Statistics for EMEA

  • ESG-related capital growth in 2020 was 28%, largely due to a flow of fundraising into sustainability-related strategies. [Oxford Economics]
  • Construction and demolition waste (CDW) produced in Europe accounts for 850 million tonnes. This is equivalent to approximately 60% of the total waste produced by Europe. [Oxford Economics]
  • The built environment is responsible for around 40% of greenhouse gas emissions globally. [Oxford Economics]
  • The European Commission announced in July 2021 that it will commit to a 55% reduction in greenhouse gas emissions (GHGE) from 1990 levels by 2030. [Oxford Economics]


Impact of technology on sustainability

  • European construction businesses plan to invest an average of €900,000 in the next five years to become more sustainable, with seven out of 10 investing in construction. [Autodesk]
  • Building Information Modeling (BIM) software offers possibilities to optimize the design phase and to deliver up to 15% less CDW. [Chalmers]
  • BIM is one of the most common tools used in sustainability initiatives (36%), enabling owners and project teams to make more data-driven decisions. [Autodesk]
  • Fifty-three percent of construction professionals say prefabrication has the greatest potential to reduce the industry’s carbon emissions. [Autodesk]


Labor shortages and the impact of Brexit

Top Construction Industry Statistics for EMEA

  • Fourteen percent: the increase in average pay packet for UK construction workers compared to the first half of 2020. [Construction News]
  • In 2021, 26% of EU contractors reported problems with labor shortages. [ING]
  • Employment in the UK construction sector fell from 2.3 million in 2017 to 2.1 million at the end of 2020. This represents a 4% fall in UK-born workers and a 42% fall in EU workers. [Office for National Statistics]
  • More than 500,000 UK-born construction workers are expected to retire in the next 10 to 15 years.  [Financial Times]
  • Official data from the Office for National Statistics reports that UK construction vacancies hit a 20-year high in August. [Construction News]


New approaches create new jobs

  • 100,000: the number of direct jobs the commercial drones market growth is projected to create in the next 20 years. [ECSO]


The growing market for digitalisation

Top Construction Industry Statistics for EMEA

  • €1 trillion: potential EU industry savings from a full-scale digitalisation in non-residential construction. [ESCO]
  • In 2019, it was expected that the European BIM market would grow by 13% from 2016 to 2023, accounting for €2.1 billion of spend. [ESCO]


Data strategy brings a competitive edge

  • Eighty-two percent: the percentage of European construction professionals collecting more data from construction technology today than three years ago. Still, 39% say that less than half of that data is usable. [FMI + Autodesk]
  • Only 9% of businesses always incorporate project data into their decision making while 64% do this sometimes, rarely, or never. [FMI + Autodesk]
  • On average, bad project data results in poor decisions 41% of the time. [FMI + Autodesk]
  • €7.1 million: the amount of waste a €1 billion contractor could avoid by making decisions using accurate data [FMI + Autodesk]

*currency conversions provided by Morningstar via Google on 12 November, 2021


Get more insights into the industry

As these 30+ statistics have demonstrated, the industry will continue to experience big changes and developments. It’s the perfect time for construction firms to tap into that momentum and reap the benefits of taking a more strategic approach to data. To begin, benchmark your current construction process with our free assessment.




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Sustainability initiatives gather pace in ANZ: key to 66% of corporate businesses’ strategies

  • Sustainability is a key part of 66% of ANZ strategies, in comparison with 53% of company strategies across APAC 
  • 92% of APAC companies are embracing sustainability due to regulation and market forces 
  • Digital adoption is a critical enabler for sustainability, but is significantly underleveraged 

AUSTRALIA & NEW ZEALAND, November 24, 2021 — Autodesk, Inc. (NASDAQ: ADSK) today launches its newest research report in collaboration with Frost & Sullivan, Enabling a Sustainable Future through Digitalisation: Trends driving the Design & Manufacturing and Architecture, Engineering and Construction Industries in APAC. The report surveys companies across architecture, engineering, construction, design and manufacturing (AEC and D&M) industries to determine current factors driving sustainability across Asia Pacific. 

Across the region, more than half (53%) of companies surveyed indicated sustainability was an important part or cornerstone of their business strategy. In Australia and New Zealand the market is more mature, with 66% of companies surveyed mentioning sustainability is an important part of the strategy or even a cornerstone. The findings also show sustainability initiatives are gathering pace in the region, with the key drivers being regulation and market forces (92%), investor relations (87%), and competitive advantage (80%). 

APAC is a significant contributor to climate change 

The massive impact on climate change, driven by the increasing consumption in energy and materials, is accelerating the demand for sustainability across the AEC and D&M sectors. APAC now contributes 53% of global GHG emissions, producing 18.3 billion metric tons of carbon dioxide in 2020 – more than the cumulative emissions from the rest of the world. Manufacturing and construction, and the building industry account for 17% and 4% GHG emissions in APAC respectively. According to research released at the recent COP26 climate summit, Australia leads the world in GHG emissions from coal per capita. In addition, about 28% of electricity production in Australia in 2020 was from renewable energy sources, far below the Organisation for Economic Co-operation and Development’s average of 40%. For the world to progress towards the net zero goal, it is necessary for these sectors in APAC to change how they approach sustainability. 

Governments across the region are pledging to contribute to sustainability while balancing the imperative of economic growth. Initiatives such as the Green Building Council of Australia’s voluntary sustainability rating system for green buildings in Australian fit-outs and communities is also a growing trend. In Australia, waste products like construction debris, slag from steel plants, etc. are being utilised for building roads. Australia’s waste policy 2018 has been developed for managing trends across states and territories. However, progress has been uneven with the region struggling to suppress the increase of GHG emissions driven by high economic growth. 

Digital adoption is a critical enabler for sustainability 

Increasing requirements for compliance with mandates and regulations related to energy consumption and emissions reductions requires increased monitoring, measuring, reporting and verification – which data can provide. 

According to Andy Cunningham, Regional Director, Autodesk Australia & New Zealand, efficient and structured management of data is important to achieving sustainability goals, highlighting the need for increased digital adoption. Technology can support businesses to reduce GHG emissions and waste, and accelerate the design and make of safer, healthier and more resilient products and places. 

“Digital technologies are providing a bridge to approach sustainability challenges in a new way. For example, key environmental issues such as climate change, resource depletion, and environmental protection are being addressed through digital solutions such as digital twin and lean construction – major trends that are driving sustainability in Australia and New Zealand.” 

“Two major challenges organisations face in their journey towards sustainability is the lack of skills and resources, which are being compounded by the ageing of assets. Digital adoption is the key to overcoming these challenges and is a critical enabler for sustainability, but it is still massively underleveraged,” said Mr Cunningham. 

According to Mr Cunningham, APAC presents a massive growth potential but is also the region with the least technology adoption. “In order to sustain the growth and the scale, it is now imperative for the public and the private sector in the region to be more aggressive in adopting technologies to capitalise on the potential and also achieve the common sustainability goals,” he said. 

Large economies in the region have already committed more than US$250 billion in investment towards sustainability, and indicated timelines to become carbon neutral. Yet, only two countries from the region appear in the top 25 in the Global Sustainability Index 2021. 

According to Ravi Krishnaswamy, Senior Vice President, Energy & Environment, Industrial, APAC, Frost & Sullivan, “With increasing focus on adopting sustainable development goals and gaining a competitive advantage, digital technologies are driving the convergence necessary for achieving a balanced growth between business and environment. Digitalisation has emerged as one of the top strategy agendas for many corporations worldwide. 

“As a result companies are increasingly adopting digital solutions for compliance related data measurement and reporting, easy collaboration with supply-chain partners, data on low-carbon materials, and machine-learning and artificial-intelligence capabilities for improving their sustainability quotient.” 

Action must now be taken to embrace digitalisation as an enabling pillar and increase the commitment towards sustainability, contributing to the global cause while upholding often divergent stakeholder interests. To download the report visit

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Working In and With 3D Environments to Deliver Better Outcomes for Lomans’ Clients

Lomans are an end-to-end installation company in the Netherlands who work today on the smart buildings and sustainable installations of tomorrow. They have all construction specialities under one roof: electrical engineering, mechanical engineering and smart buildings. Their market extends to all types of buildings and their focus is on the long, and therefore, sustainable term. Lomans are familiar with all phases of the installation process when it comes to construction projects – from the design phase to operations and maintenance keeping a clear vision on implementing sustainable, innovative, and creative solutions. With mechanical, electrical and plumbing specialists in one place, the team at Lomans have experience working on a range of projects extending from distribution locations and offices to residential accommodation.  

Company growth and different ways of working

Lomans have approximately 400 employees with an estimated 250 colleagues working in the field on construction project sites. Over the last few years, the company has seen stronger growth with more and more projects being added to their portfolio. However, this expansion created some issues when it came to managing their day-to-day processes on projects. Bas Spaan, Data and Information Manager for Lomans, says: “With our company growth it soon became clear that there was no standardised approach to the way in which we implemented and used digital solutions on our projects. We have a number of different departments here at Lomans and many of them were working in entirely different ways.”

For Bas, managing project data and ensuring teams had access to the most up-to-date and accurate project information became challenging. “In some cases email became our single source of truth for the project teams at Lomans but this was not at always reliable nor sustainable.”  At a minimum, Bas estimates that most of the project document was saved in at least two different locations – ranging from local network drives to different collaboration platforms and document sharing websites.

Lomans splits their company into customer teams who focus on the end-to-end project delivery processes. Working in this way means all project collaborators engage directly as one group – for example commercial, maintenance, engineering and bid teams, bring the overall construction process together smoothly.  They work on a variety of big and small projects. “Our teams were collectively brought together in a deliberate move to focus more on the outcomes we deliver as opposed to the disciplines we belong to. However, this process showed us even more acutely that we needed better tools to support us to work more collaboratively and started our journey towards digitalisation,” affirms Bas.  

Lomans were already using Revit, one of the design products in Autodesk’s AEC collection, for their 3D modelling and coordination. Bas found that Revit provided data rich models which provided vital project insights, but this important information was not always accessible to everyone on a project.

“With the exception of modellers, the wider team members were completely blind when it came to the insights they needed on our projects.”

—Bas Spaan, Data and Information Manager, Lomans

“So, we needed to find a way to better share important project data in a straightforward way that didn’t add too much time and complexity,” says Bas.

“Prior to implementing Autodesk’s Construction Cloud platform, Lomans worked with several manual processes. We had team members who printed off 3D drawings and worked in a 2D way using 3D information, which was clearly not the vision we wanted for the company,” says Bas. “The process was time consuming and lengthy and, team members couldn’t always be sure they had u accurate and up to date project information. Getting our hands on key project insight was more complex than simply looking at a drawing.” 

Choosing the right solution

Over the last few years, Loman’s set out their 2030 future vision to focus on using cloud solutions for their construction project data to collaborate seamlessly internally and externally on projects. The team started using Autodesk Construction Cloud’s BIM 360 platform as their common data environment in 2019.  “Our long-term plan has always been to align and use Autodesk Construction Cloud products so when Autodesk Build was launched, we knew that was the direction we wanted to travel in,” says Bas.

“We know that in the future we’ll be working differently with technology. Soon, the computer will be telling us the best way to work, not the other way round! We have realised that working in a cloud environment is a fundamental element to moving closer to this reality.”

—Bas Spaan, Data and Information Manager, Lomans

“Autodesk’s reputation in the market gives us the assurance we need that they are the right cloud software provider for us,” says Bas. “Seeing the capability of Autodesk’s cloud and the work they’re involved in when it comes to shaping the future of our industry, it was totally clear that this was the right company for us to work with.” For Lomans, other providers offered them an end point solution but not a solution that enabled collaboration between the design, construction, and operation phases of their projects.

Sprinting to standardisation

The team at Lomans began using Autodesk Build in early 2021. They started by rolling out the technology on a team-by-team basis. “We actually started with the least digitalised team at Lomans when it came to the rollout of Autodesk Build,” says Bas. Rather than implement the technology on all projects at once, Bas and the team introduced the technology by adopting a ‘sprint’ methodology. This allowed the team to get familiar using one particular digital workflow or process in depth at a time and then move on to the next process from there. “Rolling out the technology in this way helped to reduce disruption to our current projects and enabled us to learn from the cloud environment and from each other,” says Bas.

All new projects were implemented using Autodesk Build’s cloud environment. The first team to use the technology worked on small retail projects which were usually shorter in length than some of Lomans’s bigger projects. Bas reflects; “We could iteratively use the digital workflows and build our knowledge out bit by bit. We were also able to test some of the more complex workflows like markups and revisions on smaller projects and learn quite quickly about what did and didn’t work.”  

Getting the basics right

By adopting this approach Bas and the team could quickly identify the best practices Lomans wanted to take forward. They started with getting the basics right with document management, then built on workflows like revisions, markups, checklists and issues management. “Using small steps and starting with the basics when it came to document management has meant that we’ve been provided with invaluable learning time,” says Bas. 

The team at Lomans now use Autodesk Build for all new construction projects. Project data is structured in a standardised way which means any new team members joining an ongoing construction project know exactly where to go in their common data environment for the relevant information to get up to speed. Bas aims to be able to support construction teams use the permission sharing features when collaborating with external partners. This will remove the risk around data regulations and ensures the internal project team at Lomans can feel confident that the right people have access to the right information at the right time.

“We decided to use Autodesk Build for an annual process we carry out in our retail teams,” says Bas. “This involves emergency lighting checks for over 800 shops that we manage. Prior to implementing Autodesk Build, this was an entirely paper-based process which was not only time consuming but also risky, as important information could be lost during this process.”

Achieving the 2030 vision starts today

Looking to the future, Lomans plan to use more and more of the features and functionality that Autodesk Build offers including automating annual processes. Lomans are also investing in the optimal tools for their team when it comes to using Autodesk Build, which includes providing employees with laptops and smart devices. “The time our team has saved using the solution already has been immense,” says Bas. “Searching for documents is not only time consuming but also frustrating. The thinking that goes into this activity has also been removed,” reflects Bas. “Our teams can now focus on the value-added activities like making sure our projects are delivered to the best quality. We can also focus on more robust quality checks rather than wasting time on administrative tasks,” says Bas.

The vision for Lomans is that all projects will be live on Autodesk’s Construction Cloud and time will not be wasted searching for documents, looking for data or waiting for information to be provided. “For our team at Lomans, we’ve removed the need to search for documents on a project; they’ll be exactly where you need them to be,” states Bas.

For Bas, happy customers drive business growth so focusing on quality and implementing smarter ways of working will be invaluable for the team at Lomans. “Ultimately, our team’s expertise can be used to the best of their abilities. We can better support our customers to address their needs and solve their problems for improved outcomes,” says Bas.

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Construction Budgeting 101

Your construction budget is one of the most important things to get right in any project. Poor budgeting leads to inaccurate estimates and error-prone forecasts, which can result in unfavorable project outcomes.

The lack of proper budgeting practices can also lead to communication breakdowns and misalignment. When your team members can’t get on the same page on project spending, you’re more likely to run into design, construction, and admin errors.

Ultimately, an inadequate construction budget leads to cost overruns, wasted time, and lower profit margins. For this reason, it’s important to understand and implement cost management best practices. It also helps to equip your teams with tools that can help keep your project’s financials in check.

In this post, we’ll go over all these points to give you a better understanding of construction budgeting and how to implement it. You’ll walk away with a solid grasp of budgeting fundamentals, along with tips to help you maintain strong profit margins throughout the lifecycle of your projects.


Construction budget basics

To successfully create your budget, you need to have good data, a reliable team, and a thorough understanding of the scope of work. When these components are in place, you’re better equipped to come up with accurate budgets and estimates.

Have access to the right data

You need to get your hands on accurate and up-to-date data; otherwise, you won’t be able to produce reliable estimates and projections. To that end, strive to create easy access to the most recent and relevant data possible.

Work with strong team members

The people with whom you collaborate can have a massive impact on the amount of money and time you spend on a project. See to it that you’re working with a qualified team of contractors and subcontractors.

Build relationships with people who are honest, transparent, and good at communicating. In addition to ensuring that you get the most accurate figures, these types of individuals make collaboration much easier. You’re less likely to run into miscommunication, which helps to avoid issues such as misaligned expectations and change orders.

Iron out the scope

Scope out the work as thoroughly as you can. Conduct a proper site inspection, and don’t shy away from asking detailed questions before drawing up an estimate. Get down to the nitty gritty if you have to. For example, make it a point to verify any unit prices on the budget that you can. The more accurate your estimates, the more satisfied everyone will be with outcomes because expectations were better set from the beginning. For best results, work closely with all stakeholders to determine the objectives, timelines, and deliverables of the project.

It takes a bit more work up front, but spending this time and effort in defining a job’s scope will enable you to create a detailed and accurate budget that’ll serve you and your teams as you go through the project lifecycle.


Preconstruction budget planning

A lot of budget-related activities take place during the preconstruction phase, and for good reason. Effective budgeting means planning your expenditures in advance and allocating your resources accordingly. By managing your budget during preconstruction, you’re able to consider the entire building process before breaking ground, ultimately helping you mitigate risks and cost overruns.

How preconstruction budget planning works

Generally speaking, the preconstruction budgeting process involves the following steps.

Conduct initial meetings: Teams kick off a project by holding a meeting (or a series of meetings) wherein the client and contractor discuss the objectives and other details of the particular construction project. The client may share an initial budget or figure that they have in mind for the job.

Come up with project estimates: This figure isn’t set in stone. The contractor must evaluate the details of the project—including specifications, market rates, and historical costs—to determine whether or not it’s feasible to complete the job with the given amount. At this stage, the contractor also needs to consider factors like material costs, subcontractor and labor expenses, and other contingencies to figure out how much they’re likely to spend.

Implement value engineering: Teams can also implement value engineering—the practice of maximizing value by optimizing each project’s component in relation to the cost. Contractors implementing value engineering must assess the functionality or value of different aspects of the job and allocate resources accordingly.

For example, if a client values sustainability in their projects, the contractor could optimize the budget so that it allocates more resources to the components that make the building eco-friendly, while at the same time finding cost-savings in other areas.

Different types of costs to consider

During the preconstruction budget planning stage, the costs that contractors have to consider typically fall into the following categories.

Administrative: Admin expenses cover design and engineering costs, along with other activities related to the management of project affairs (e.g., securing permits, drawing up paperwork, etc.)

Labor: Specialty contractors and the site crew all need to be paid, so ensure that you properly account for labor costs in your budget.

Preparation of the site: Any expenses incurred as part of site preparation should also be considered. These costs may include demolishing existing buildings and removing debris from the site.

Supplies and equipment: Costs under this category include any materials, equipment, and supplies necessary to build the project.

Consider the entire lifecycle of a project

When planning your expenses, it’s important to think about the entire lifecycle of the project and determine how much of the budget will be spent at each stage.

Design: This stage largely involves architects and members of the design team working together to come up with models for the project. Once everyone has signed off on the plans and specifications, the next task is to list the required materials and expenses necessary to procure them.

Preconstruction: Before breaking ground, stakeholders must first ensure that the site is prepared for construction. At this stage, activities such as soil testing, site inspections, and plan reviews would take place. Once these steps are complete, the budget, design, and schedule will be finalized.

Procurement: At the procurement phase, the team secures all the materials, supplies, and equipment required to build the project.

Construction:This is the actual execution of the job. At this point, construction crews make it to the job site to work on the building.

Closeout: Once the building is complete, the project enters the closeout stage. The construction site will be cleared up, equipment rentals will be returned, and the crew will be demobilized.


Common construction cost overruns

Here’s a not-so-fun fact: cost overruns are quite common in construction. KPMG found that just 31% of construction projects come within 10% of the budget, which means the sizable majority of projects exceed their original budget.

You can prevent this from happening by being aware of the most common reasons behind construction cost overruns and taking steps to mitigate them.

Inaccurate project estimates

Inaccurate estimates during the preconstruction process can lead to mismatched expectations regarding the project scope. When you underestimate the time and money it takes to complete a job or activity, you may end up spending more resources than originally planned and go over your budget. This can also negatively impact owner-contractor relationships.

The best way to prevent this is to set realistic and data-backed budget expectations during the preconstruction phase. Collaborate closely with all stakeholders to come up with the appropriate figures and always rely on data when making calculations.

Design errors

Poorly designed, inaccurate, or incomplete plan models will inevitably lead to delays and unnecessary costs down the line. This is why it’s essential for owners and contractors to be on the same page when discussing the scope and objectives of the job. During the design stage, ensure that all stakeholders are kept in the loop with all updates and changes.

It also helps to use technology. Digital models are much easier to update compared to paper documents. What’s more, digital solutions such as construction project management software streamline collaboration, issue detection and resolution, and progress tracking.

Unaddressed design errors can be expected to manifest in costly rework if discovered in any phase following design.

Change order errors

Change orders take place when the owner or contractor implements modifications to the project after the models and budgets have already been approved. Change orders, which can come in the form of new specs, fixes, and requirements, lead to changes in the budget, and often take additional resources to carry out.

It’s not easy to avoid change orders, but you can take steps to plan for them. During the budgeting stage, allocate time and resources for changes or disputes. Construction software can also come in handy here, as there are applications that can simulate scope changes during the preconstruction phase. This will help you anticipate different possibilities and budget accordingly.

Administrative errors

Admin errors are another common cause of construction overruns. Tasks related to scheduling, securing permits, and accounting can be quite complex. And if they’re done manually,  it’s common for inefficiencies to perpetuate due to human error..

One of the best ways to avoid admin mistakes is to streamline various activities using technology. Integrated construction solutions, for instance, can automate data entry from one system to the next. In addition, project management software can improve visibility of data for administrators and ensure the accuracy of project documents.

Site management errors

As far as construction projects go, a lot of the action takes place on the job site, as this is where projects come to life. As such, job sites have many moving parts—you have your crew, equipment, supplies, and more.

Failing to manage any of the above components can lead to on-site conflict, delays, and additional expenses. Fortunately, these issues are easily preventable with proper communication. Keeping everyone aligned on the project specs, timelines, and budget will lead to a smoother experience for all stakeholders. When everyone knows what needs to be done and when they need to do it, you have stronger accountability and worker performance on-site.

How to resolve these common cost overruns? Build a good team.

You can have the best tools, materials, and resources at your fingertips, but these things are only as good as the people using them. That’s why it’s important to bring in the right people for the job. Take the time to vet and investigate your subcontractors, particularly in areas like trust and safety. Doing so will enable you to build a strong team from the get-go.


Technology for budgeting

Budgeting for construction projects isn’t easy, and this is where technology comes in.

Whether you need to streamline data entry and cost calculations or require better visibility into the different components of your projects, there are several technology solutions that can assist your workflows.

Bidding and estimating

During the bidding and estimating stage, contractors and estimators gather the necessary project details to form an accurate estimate and submit a bid. This process involves developing quantity takeoffs, gathering material prices, equipment costs, and more.

Bid management and estimating technology is meant to support a smoother preconstruction process. Functionality will depend on who is using it, and there are good solutions in the market for owners, general contractors, and specialty contractors.

Good bidding and estimating technology should:

  • Combine 2D and 3D quantification into a single solution to help you come up with highly accurate estimates and competitive bids.
  • Quickly access drawing and model-based quantification workflows, so estimating teams can collaborate better.
  • Connect builders and owners so both parties can implement a smooth bid and risk management process.
  • Enable general contractors to discover specialty contractors, qualify them for projects, and manage invites and bid submissions.
  • Enable specialty contractors to view, track, and handle all their bid invites from one place, so they can manage their workload and ensure that no job slips through the cracks.

Project management


At the submittals phase, the contractor submits project documents (e.g. submittals package) to the architect and design team. The team will then review the package, and once approved, will share it with field teams.

Managing the submittals process is significantly more efficient nowadays with readily available technology. Without getting too into the weeds, good solutions use AI (algorithms) to read your specs and automatically pull action submittals, product data, and more. This makes generating submittal logs much easier by enabling teams to further streamline their process. They can efficiently coordinate and manage all submittals in a single submittal log in the cloud.

RFI Management

Much like submittals, managing RFIs is very important to budget given its impact on cost and schedule. According to Navigant Consulting Forum, a typical project receives an average of 796 RFIs. It can cost over $1080 to respond to each one of them. That means RFI’s on a single project could impact a project’s bottom line by up to $860,000.

Knowing that RFIs can incur such steep costs and create project delays while the RFI is being responded to, good RFI management solutions should help flag high-risk RFIs so you can prioritize which RFIs need action. RFI management software should also help you catch design issues earlier to improve handover from design to construction and avoid exponentially expensive design issues caught later in the process. Last, RFI software solutions can help you identify risk across multiple projects so you can proactively make decisions about how to handle RFIs before they pop up.

Cost management

Cost management is about controlling costs to keep a project’s budget on track. That’s often easier said than done, but remember that the goal is to stay within budget to achieve max profitability. Managing costs is necessary at all stages of a project and requires having systems in place to ensure that you’re meeting intended targets.

So, what does good cost management software do? It should make navigating cost-related decisions much easier by giving you the exact data you need, when you need it. That often equates to helping you create more dependable forecasts, make better decisions on tighter timelines, and ultimately, give you a stronger handle of a project’s financials at every phase.

To make all that possible, good cost management technology enables you to connect real-time project and field data with cost activities. This increases the viability of cost-related activities because you’re able to understand—and report on—the impact of these activities to your bottom line.

Considering how closely tied cost-activities are to schedule, project management software should also centralize your project schedules and better yet, allow you to connect schedule and cost data. This enables your team to connect the schedule with the entire project and share information instantly to prevent costly downtime or miscommunication.


Ready to level up your construction budgeting?

Construction budgeting can be an arduous task, but it doesn’t have to be.

You can take the stress and hassle out of budgeting and cost management if you work with metric-minded team members and communicate with them openly. You should also establish budgeting processes that are relatively simple to implement. No need to overwhelm your team if you’re just getting your budgeting practices sorted out. There will be an inevitable learning curve and it’s something everyone can benefit from. Finally, equip your teams with digital construction tools that can automate tedious tasks. You’ll promote collaboration, make better decisions, and provide better visibility into the impact of those decisions on construction budgets.

By taking these guidelines, you’ll be able to budget smarter, reduce cost overruns, and improve overall project outcomes.

If you’re looking for robust tools and a strong technology partner to help you improve your budgeting practices, check out Autodesk Construction Cloud. Find out why some of the world’s top construction owners and firms trust Autodesk to power their teams and projects.


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