Credit: Iwan Baan
Architecture firms have spent the past 50 years upgrading their hardware and software and training their staff to be more efficient. Despite these investments, the construction industry’s productivity has only declined for the past 50 years, and steadily so.
Paul Teicholz, a professor emeritus of environmental and civil engineering at Stanford University, first brought the technology paradox to the industry’s attention in 1999. In a 2013 review of his work in AECbytes, Teicholz includes the following graph that examines productivity.
Credit: Paul Teicholz / AECbytes and the U.S. Census Bureau of Labor Statistics
Between 1964 and 2012, the construction industry’s productivity dropped 0.32 percent per year, according to Teicholz’s analysis of data from the Bureau of Labor Statistics. In other words, a $100-million hospital (adjusting for inflation) would take roughly 20 percent more staff-hours to design and build today than it did in 1964. Meanwhile, the productivity of other non-farm industries has increased 3.06 percent per year since 1964.
You’ve probably heard this statistic before. It is a staple slide at technology conferences, including this year’s BIMForum in April, and appears in several publications, including ARCHITECT’s recent examination on national BIM standards.
The industry typically responds to this statistic in one of two ways. Technology naysayers see the paradox as affirming their beliefs that no architect needs to learn computers, and that computers waste time and detract from the real work. Meanwhile, technology proponents see the paradox as evidence of a fractured industry caught in a halfhearted transition to modernization. Productivity, they say, would increase if the industry would collectively embrace technologies such as BIM, integrated work practices, and file-to-factory fabrication.
Neither of these positions fits the reality of architecture. If architects are truly less productive today, then why not return to the design methods of the past? Forget cell phones, email, commoditized air travel, clash detection, integrated models, laser scanners, and 3D printers. I doubt any major architecture firm will step up.
Rather than ask why technology has allegedly made us less productive, we should ask why the standard measures of productivity are so detached from our technological reality?
Productivity is typically measured as the cost of a project divided by the staff-hours spent consumed. In order to increase productivity then, the construction industry must reduce the staff-hours worked while selling projects for the same price.
For architects, this is a virtually impossible scenario. An architect’s billings primarily consist of the cost of labor with a few material and equipment expenses mixed in. Any reduction in the hours worked causes a corresponding reduction to the project’s labor costs. Since architects operate in a competitive market, hungry architects will pass these cost savings to their clients by underbidding the competition. Thus, reducing staff-hours on a project will reduce the project’s costs and eliminate any measurable productivity gain—even though the clients are now getting a far better deal.
This leads to an important corollary: The client, not the architect, has the most to gain from technology. Clients have also been pushing for better, higher performing buildings, in part as a response to increasingly stringent governmental regulations on safety, accessibility, sustainability, and construction quality. For example, tougher occupational safety requirements have reduced the number of construction related deaths from 14 per 100,000 workers in 1992, to 9.9 per 100,000 workers in 2012. It’s a noteworthy improvement in how buildings are produced, but one that doesn’t show up in productivity statistics. Similarly, sustainable buildings have been correlated to societal benefits and greater post-occupancy satisfaction, but these improvements are not accounted for in productivity assessments.
The construction industry’s reluctance to invest in technology may have a similar origin. A recent Gartner IT Cost and Performance Benchmark revealed that the construction industry invests 1.0 percent of its annual revenue in technology. This investment places construction solidly in last place when compared to the 19 other surveyed industries—including healthcare, education, and manufacturing—and well under the average rate of 3.3 percent. Unsurprisingly, an industry that largely passes on benefits from technology investments to clients is reluctant to invest in anything not asked for by the client.
For architects, technology isn’t about productivity. Keeping up with technology is a way for firms stay competitive in the marketplace. There’s nothing scandalous about firms delivering more value to their clients. In fact, it should be celebrated that technology is about designing a better built environment for our clients rather than generating more profit for our firms’ owners.
Rather than taking statistics at face value, we should reconsider what it means to be productive in the construction industry as well as the benefits that technology affords our practices, our clients, and society as a whole.
Daniel Davis is a senior building information specialist at Case, Inc. His technology column will appear on this website each month. His views and conclusions are not necessarily those of ARCHITECT magazine nor of the American Institute of Architects.