Construction Industry - Research Paper Example

Construction Industry Introduction Construction industry is involved in different fields like civil engineering and architecture which consists of the assembling of the Infrastructure and buildings. In order for a project under the construction company to be effective it needs to be well planned on the workforce needed the design to be used and also other factors like the environment among others depending on the particular project (Fenn 15). A construction company basically involves a lot of activities which touches the daily life of every American person. This is because it is involved in the construction of bridges, shopping centers, homes, roads, workplaces among others. This is important in the national economy as an economy’s growth cannot be obtained without the basis of a construction industry. The construction industry is among the top ten industries which lead to growth in the economy of the United States. Most of the people get employment in this sector with different specialties leading to the economy’s improvement. The building industry involves four types of construction which are the Residential Building construction, Heavy civil construction, Commercial building construction and Industrial construction. Although it can be seen to have offered the employment opportunities to many it is a dangerous occupational injury rate as seen in 2008 which was thrice that of the workers. Significance of the Construction Industry It provides employment to most of the people as its growth is often projected to increase by more than a million between the year 2002 and 2012 (Fenn 22). This improves the economy of the country as most of the people are trained in the construction industry reducing the unemployment rate in the economy of the United States. The construction Industry is the core of all the construction locally and also internationally. Most of the structures being designed are always done by the construction company. Its effect is felt as most of the facilities are able to be constructed leading to an economy growth. An economy of a country is determined by the standing Infrastructure which are modernized. It also shows the people’s creativity and intellectual ability as it requires not the only the mind but also the skills in making it work. It is used as a tool by the government in managing the level of the economy. When there is recession and the rate of unemployment is seen to be high the government increases the public expenditure by the use of the construction industry (Fenn 29). This completely shows its contribution in the American economy as most of the people are believed to be in this sector. The construction industry related with other economic sectors using the backward forward linkage the forward showing its relationship of total output to inter-industry sales while the backward linkages. This is used in showing the relationship between total output and the industry purchase. Gross fixed capital is the expenditure on fixed assets including buildings and machinery among others in either replacing or adding stock of the fixed assets. This is related to investment as fixed assets are used in the production process. It is important public policy tool as it is used in creating employment and also increases the development in the U.S. This is through the central bank through which people invest in infrastructure leading to money injection in the economy. This industry contributes to a third of total investment in fixed assets in the economy. It has also led to the construction of new and better buildings like the hospital facilities, educational centre like schools. There has also been the construction of better recreational centers which are able to increase the number of people that can be accommodated in the building and also a concrete structure which can last for a longer period of time. Domestic Data in the Construction Industry Number Employed The number of personnel employed in this industry is rapid as it has a high employment rate as compared to other industries. According to the US Census Bureau’s 2012 statistics, the US construction industry employs 7.316.240 personnel on a part time or permanent basis (Fenn 27). Most of the people have been able to get an opportunity by getting employment which has increased the country’s economy and by reducing the unemployment rate. The government has also participated actively in promoting the industry through allocating large amounts of money to this industry. Productivity According to statistics provided by the US Census Bureau, in September of 2012 alone, a jaw dropping 894,000 building permits were issued for the construction of privately-owned housing units (Fenn, 25). In addition to this, building permits issued for the construction of single-family units were an impressive 545,000. Construction industry is a major contributor of the economic growth in the American industry. It has played a major role as most of the people invest on building through mortgage, loans and also establishing buildings, real estate’s improving the domestic number of individuals relying on this. Most of the baby boomers need new structure like different mansions and this provides an opportunity in the construction industry. Output It is estimated that up to 5 million structures are put up in the United States every year (Fenn 39). The output level experienced in this industry is high as most of the homes are built and maintained in this industry (Fenn 33). This thereby shows the amount of output obtained from various home including building for commercial use like offices and businesses. The industry has gained a lot as one is not able to construct a building without their assistance as it will be against the rules of the country. Exports Most of the construction company supplies their facilities and also their services across the world. This serves worldwide increasing the market and also the opportunity to showcase them. Most of the houses outside America are able to acquire the same services as most companies provide their workforce globally. The set up of buildings and also designers in constructing various buildings are able to market themselves and the use of new technology improves their trust internationally. Geographical Distribution The construction industry has also been able to distribute their services and also skills and built structure in different geographical areas. They have been able to determine the putting up of homes in places where it could not be possible like an area infested by floods. Through their skills most of the land in those places has been able to be covered as bridges have been constructed and also the water has been able to be directed in one direction (Fenn 43). This has been able to provide homes for people who always lived in hardships and reduced the costs incurred by the government in helping those infested by disasters like floods, hurricanes among others. Below is a brief summary of the manner in which construction companies are geographically distributed in the United States of America. States with the highest number of construction companies Figure California 72,173 Florida 51,143 Texas 43,409 New York 37,200 Illinois 30,236 Pennsylvania 28,505 North Carolina 25,457 New Jersey 23,142 World views of the Construction Industry and its Major Players. The construction industry is viewed worldwide as a key industry to any country’s development. This is from what has been seen by the number of people employed, its contribution in the financial sector and also related to every other industry in terms of building and repair. Most people invest in building search as real estate which increases the profitability to any given economy. Ideas on coming up with new and creative infrastructure come up day in day out and this also propels to people’s interest in putting up new structures. The major players in these industries include unskilled, skilled and the technical and management team. The technical and management include the civil engineers, architects and also financial advisers; they are mainly used in designing, construction and also establishing the amount of cash they are going to use in a building. The civil engineers are used in the construction process of buildings while the architects are mainly involved in designing of the building this includes the shapes. They are also involved in determining environment if it is favorable among other external factors in the construction of the building. The financial advisors are able to prevent cash flow problems which may arise in covering the costs for labor and materials (Fenn 38). The skilled are those who have experience in the field while the unskilled and the semi-skilled are the laborers as there require no knowledge or little knowledge in the construction industry. In terms of companies, the following are constantly ranked in the top 10 of the largest construction companies in the United States: Company Employees Koch Industries 80,000 (estimate) Bechtel 52,700 Kiewitt Corp. 24,700 Renco Group 20,000 (estimate) CH2M Hill Cons. 23,000 Guardian Industries 17,000 (estimate) Clark Enterprises 4,000 Kohler 30,000 (estimate) Berry Plastics 16,000 Gilbane 2,200 Source: United States Census Bureau, 2012. Worldwide, however, we have the following: Position Company 1. China State Construction and Engineering Corporation (CSCEC) 2. China Railway Construction Corporation (CRCC) 3. China Railway Group (China Railway Engineering Corporation, CREC) 4. VINCI 5. China Communications Construction Company Group (CCCC) 6. ACS (Actividades de Construcción y Servicios, S.A.) 7. China Metallurgical Group Corporation (MCC) 8. Bouygues Construction 9. Bechtel Corporation 10. Hochtief AG Source: United States Census Bureau, 2012 Issues Pertinent to this Industry today and in the Future Demographic factors are only favorable for structures like hospitals and schools but not convenient for structures like offices and apartments (Fenn 48). The construction industry image and outreach as taken by the people is negative. Its image as seen by people has been poor mainly from the accidents experienced in this sector. This demoralizes people as they see by taking this jobs they will be risking their own lives and prefer to remain unemployed. They also think that they do not have enough skills and think that they will find hardships in attaining the job requirements. This has also been contributed by the views in the corporate culture as most of the people want bigger jobs despite their inexperience. This image can be rectified by providing education from parents, youths, friends and relatives encouraging each other on the usefulness and importance of working in this company. The safety of the workers in this sector should also be improved by providing them with the necessary equipment and cloth ware. According to Fenn (31), lack of proper skills, education and training capacity by most of the youths in this time period has also been a major challenge and issue. Most of the youth are not able to communicate with ease thus lack language skills. They also lack skills needed in the construction company this may be because they did not undergo training or are uneducated. This can be improved by providing proper facilities and resources needed by the technical schools which will lead the people becoming learned. They can also be given books and also be taken to programs which will help them develop their skill either through apprenticeship and also training provides them with a better way of managing themselves. The shortage of workers in the Industry There is shortage of workers in the construction industry and by the growth of the industry and most of the youth in this era. This can be led maybe by lack of awareness on the job opportunities in this industry and also the image seen by people of whom they find it having a poor image (Fenn 35). Women have not yet been able to come out and be competitive in this industry mainly because of cultural values like these jobs should just be for men or they find the jobs harder on them. This can be improved through proper education on these jobs and also trying to remove this bad image from the people and be able to find the job opportunities. Competition among the companies has increased. There is an increase in competition as many companies compete for the same projects in the market. The competition has increased locally and also across the world. This leads to some companies not being able to provide their services due to evolvement of many industries. Competition can be minimized mainly by the companies being creative, improving their services which might boost them. Lack of enough education and training facilities available in educational centers. The number of facilities which provide training education and skills limit the number of people who are able to access it (Fenn, 46). They also lack equipment which is used in the heavy construction company as new technology has been adopted and so it triggers one from attaining the proper skills required. This can be improved by enabling them to access such equipment and also increasing the number of educational facilities. This will increase the number of individuals acquiring the skills enabling most of them acquire jobs. Conclusion The construction company is an important industry in the American economy’s growth as it has created job opportunities to many of the citizens by over a million between 2002 and 2012.Most of the people invests in this industry increasing the GDP over the years (Fenn 56). Any other industry relies on the construction industry in building and maintaining facilities in order for the work to flow of work in a company. Although it has contributed to the country’s economy it can also be said to have experienced many challenges including competition, lack of workers in the industry among others. It is also seen that the construction industry is important to the economy from the legislation which authorized investment of a large amount of money in the construction based works in order to stimulate the economy and also in creating employment. Work Cited Fenn, Dominic. Construction industry. 11th ed. / ed. Hampton, Middlesex, England: Key Note Publications, 2009. Print. Read More