The construction industry has been undergoing a remarkable digital transformation.
Each day, cutting-edge software and tools redefine how construction projects are planned and executed, delivering greater efficiency, safety, and profitability.
However, tracing this technological shift’s pace would be difficult without relying on some key facts and figures.
In this article, we dive into the latest statistics on construction digitalization, uncovering trends, challenges, and opportunities.
Whether you’re a contractor, project manager, or industry enthusiast, join us and discover why adopting digital solutions isn’t just smart, but essential for staying competitive in today’s market!
In this article...
The Global Construction Software Market Could Hit $44.34B by 2029
First, let’s look at the global construction software market.
According to TechSciResearch’s forecast, the market’s value will more than double by 2029, hitting $44.34 billion and a CAGR of 14.30%.
The stunning growth during the 2024-2029 forecast period would be most evident in the North American market.
The report also identifies notable challenges ahead, from high upfront costs and integration complexity to data privacy concerns and lack of training.
Nevertheless, businesses that hesitate to embrace technology and tackle these obstacles risk getting left behind.
47% of Construction Professionals Think the Sector Lags Behind in Terms of Digitalization
Despite the construction software market’s projected growth, the construction sector remains slow to embrace new digital tools.
Namely, the 2023 survey of 723 design and construction professionals reveals that nearly half of them think construction is falling behind in terms of digitalization.
How is this a widely held belief when so many construction companies rely heavily on different construction technologies?
Autodesk’s recent findings suggest that cloud-based solutions, building information modeling (BIM) software, and data analytics are very prevalent among construction companies.
One explanation is that the industry is largely decentralized and dominated by small and medium-sized (SME) firms which typically take longer to adopt new technologies.
A Deloitte report underlines that SMEs lack the necessary capital, but also the capabilities to invest in digitalization the way bigger companies can.
But it goes beyond the expenses.
With so many choices on the market, finding the right software can be time-consuming for smaller organizations, notes Jane Prokop, Mastercard’s Executive VP and Global Head for SMEs.
Although this applies beyond construction, it’s also one of the reasons why many construction processes remain manual.
This, in turn, reinforces the impression of construction lagging behind.
As it is, the only surefire way of moving forward with digitalization—no matter the size of your business—is by carving out the time and resources to discover and adopt existing solutions.
29% of Construction Professionals See BIM as the Foundation of Digital Transformation
While it’s difficult to single out one defining construction technology, the NBS survey shows that 29% of professionals link BIM to digital transformation efforts.
BIM has been termed the enabler of digital transformation, and given its critical role in both preconstruction and execution, it’s not difficult to see why.
The idea of creating a digital representation that shows all of the structure’s key characteristics goes back to the 60s and 70s.
Nowadays, BIM enables an unprecedented level of insight into project design and execution, helping companies streamline planning, visualize outcomes, and enhance collaboration.
Moreover, different studies have delved into the ROI of adopting BIM solutions, highlighting significant cost and time savings.
Beyond immediate benefits, BIM solutions increasingly drive multiple processes, making it one of the cornerstones of modern construction and a starting point for digital transformation.
Immersive Technologies are Used by 36% of Construction Businesses
Immersive technologies like Augmented Reality (AR), Virtual Reality (VR), and Mixed Reality (MR) are used by a good portion of construction businesses.
Immersive technologies have different applications, from conducting safety training to enabling users to interact with BIM models more intuitively as AR leans on BIM to overlay digital models onto real-world construction sites.
Here’s how engineering and consultancy service provider Tebin LLC uses augmented reality and related technologies in combination with BIM modeling.
As pointed out in this short video, such immersion isn’t a necessity on all projects, but it can significantly boost accuracy and mitigate the risk of rework.
77% of Industry Professionals Face Challenges Adopting New Technologies
We’ve already mentioned some challenges of adopting new technologies, but have you ever wondered just how common they are?
PlanRadar’s recent global survey uncovered that 77% of professionals struggle with this.
Luckily, the report also gives some clues about the underlying causes.
It’s important to note that for 65.6% of the surveyed companies, digitalization efforts didn’t include hiring staff with digital expertise.
David Philp, the Chief Value Officer for one of the leading digital transformation providers Cohesive, explains that this lack of forethought creates more trouble than worth.
Without the right infrastructure and dedicated personnel, the new solution is less likely to meet objectives and deliver visible benefits.
Additionally, if you’re implementing cutting-edge technology without someone to adjust your current processes or come up with new ones, it’s natural you’ll be having a difficult time.
Digital Skills Gap Hinders Tech Adoption for 42% of Construction Professionals
Adequate personnel is not just important for adjusting internal processes.
Over 40% of construction professionals consider the digital skills gap the biggest barrier to tech adoption in general.
It’s an even bigger problem than budget.
In response to this obstacle, more and more construction companies are making it a priority to look for user-friendly solutions and provide digital skills training.
Autodesk’s research also shows that 42% of businesses provide digital skills training to employees.
In the end, education is the only way to bridge the digital skills gap, but its overall effectiveness will depend on your approach.
39% of Firms Report Productivity Gains from New Technology Adoption
When done right, adoption of new technology is bound to result in substantial gains.
Autodesk collected responses from top executives or owners of 933 construction firms, with 39% reporting increased productivity.
These gains are even more important considering the pressing labor shortage issues, made worse by the inevitable retirement of a large number of skilled workers.
This is part of the motivation for construction juggernauts like Shimizu Corporation to deploy technology that aims to boost labor productivity.
By delegating specific construction tasks to robots, Shimizu’s goal is to achieve a 70%+ reduction in labor.
The results are already more than promising.
Of course, not too many companies have the resources to transform jobsites the way Shimizu Corporation does, but there are other options.
Consider the advantages of BIM mentioned earlier—having all project details accessible on a tablet, rather than sifting through dozens of blueprints, already saves you lots of time.
Jeff Gouveia, the Executive Vice-President of Suffolk Construction gives a telling estimate.
Technology is transformative at its very essence, so automating even minor processes will result in time and cost savings.
62% of Businesses Improve Cost Estimation Accuracy Through Digitalization
Cost estimation accuracy is another aspect of your business to improve through digitalization.
RICS survey participants reported several benefits of construction digitalization, with the biggest being “cost estimation, forecasting, planning, and management.”
According to RICS, “cost estimation, prediction, planning, and control’ were also the top reasons for contributors from the Americas and Europe to adopt digital technologies in the first place.
Accurate cost assessment and forecasting ensure you’re creating bids that are both competitive and profitable, and there are a range of tools that businesses can use.
Regardless of your pick, cost estimation software can quickly and accurately analyze a wealth of data, figuring in the inflation rates, economic factors, and regional variations impacting material and labor costs.
Abe Schainker, Senior VP of Cost Management for JLL urges companies to keep in mind that the tools can only create value if your employees know how to use them.
Cost estimation is a complex endeavor, which is why integrating technology while providing training is so important to a growing number of construction companies.
67% Believe AI and Digital Transformation Lead to Better Decision-Making
Two-thirds of Gleeds’ survey respondents see improved decision-making as one of the primary benefits of adopting AI and investing in digital transformation.
Emerging AI technologies are becoming increasingly popular for their ability to analyze large amounts of data and find patterns without the threat of blindspots, driving smarter decisions.
Senthil Kumar, CTO and Head of AI at Slate Technologies explains that AI unlocks dozens of new perspectives, which makes it easier to reduce risks and improve overall performance.
However, the Gleeds report also identified the lack of skills as a common barrier to AI adoption.
Overall, AI systems are a powerful tool, but their successful adoption requires careful consideration and proper training on how to best interpret and use the results.
67% of Construction Firms Use Digital Tools to Calculate Sustainability Metrics
Sustainability is now an integral part of modern construction, which puts pressure on construction firms to monitor emissions and reduce their carbon footprint.
According to the NBS report, many companies rely on digital tools to track specific sustainability metrics.
For instance, embodied carbon (40%) and energy demand (38%) are the most closely monitored metrics, closely followed by lifecycle analysis (32%).
BIM-based tools allow companies to simulate energy consumption across a building’s lifecycle, laying the groundwork for more energy-efficient designs.
Similarly, software platforms that integrate lifecycle analysis (LCA) can help you evaluate the environmental impact of materials and methods, enabling greener choices.
However, only a fifth of surveyed companies calculate water use demand (19%) and waste (18%).
What can we conclude from this?
Businesses prioritize metrics with immediate regulatory or environmental relevance, and digital tools are simply adapting to meet these demands.
Still, the existing solutions are proving effective in helping companies meet sustainability goals, giving you another compelling reason to embark on your construction digitalization journey.
Conclusion
Understanding current construction digitalization trends is crucial for any business looking to move forward.
The data couldn’t be clearer on one thing, though: digitalization creates value, and it’s here to stay.
Construction companies that embrace advanced technologies are cutting costs, improving productivity, and creating more efficient and sustainable job sites.
Of course, innovation is not without its challenges—resistant attitudes, limited digital skills, and funding constraints remain significant obstacles to fully utilizing technology.
But those who are ready to try and adapt will reap the benefits that set their business apart.
