Future of Construction Industry: COVID-19 and Its Implications on Construction Projects and Risk Management – A Review

Abstract

The global coronavirus (COVID-19) pandemic has created a whole new set of risks in construction industries generating unprecedented delays, disruptions, and uncertainty on construction projects, and has forced the industries in adopting more sophisticated technologies while combating the reduced workforce on job sites. Further, the post-pandemic era of construction is expected to be a lot different as the industries will embrace the technology as the augmentation and collaboration strategy. Thus, it will be extremely hard to sustain for construction industries in the absence of effective risk management. The existing risk plans need to be inspected for their capability of handling new risks arising from COVID-19 and the project managers will need to make the necessary revisions as needed. This paper discusses on past (NORM), present (NEW NORM), and future (Post COVID-19 NORM) of the construction industry and highlights key strategies for managing projects and construction risks during and post COVID-19 pandemic.

Key Initiatives for Digital Transformation, Green New Deal and Recovery after COVID-19 within the Construction Industry in Korea

“…In addition, the operation of small and medium-sized construction companies was supported financially. In addition to these measures, several previous studies have suggested establishing a disaster response system, revitalizing production methods and technology development, and establishing new safety practices as mid-to long-term measures for the construction industry in response to COVID-19 [3,4,[11][12][13][14].…”

“…Studies that have addressed recovery after COVID-19 have primarily focused on emergency support for construction sites, measures to return construction companies to a standard operating environment, and mid-to long-term measures for the construction industry [3,4,[11][12][13][14]. Specific measures for emergency support for construction sites have included early payment for public projects, expansion of the scope of use of occupational safety and health management expenses, improvement of regulations associated with the extension of the contract period and adjustments, temporary relief for working hours, and administrative support for material procurement and labor supply.…”

“…Recovery after COVID-19 (RC) (RC1) Expansion of public funds and tax relief. When it is difficult to conduct regular business due to an epidemic, the government and financial institutions offer wider financial support and reduce tax [3,[11][12][13][14] (RC2) International cooperation for material procurement and labor supply Prepare measures for cooperation between countries, such as simplifying customs procedures to support the supply and demand of materials and workforce smoothly in the event of an epidemic disaster [3,4,11,12] (RC3) Revision of contractual provisions related to infectious diseases Within the standard contract terms at home and abroad, infectious diseases are included as a part of force majeure due to the disruption to construction…”

“…Though various solutions have been proposed in the past, labor productivity improvement in construction has averaged 1 percent a year over the past two decades, compared with 3.6 percent in other manufacturing industries [1]. In particular, due to COVID-19, the construction industry has experienced a decrease in order volume, disruption to supply chains, and difficulties in operating construction sites [3,4]. In addition, due to the climate crisis and the resulting international prioritization of a reduction in carbon emissions, the construction industry, which accounts for 35 percent of total energy consumption and 38 percent of energy-related CO 2 emission worldwide, is required to adapt accordingly [5,6].…”

Distinctive determinants of financial indebtedness: evidence from Slovak and Czech enterprises

“…261-284) -one of them is also the construction sector. As declared by Adhikari and Poudyal (2021), the economic consequences of the pandemic have created a new set of risks in this sector of the economy related to disruptions, delays, or uncertainty in construction projects. The situation in the construction sector is worsened by disorder in supply chains and financial bubbles, which can lead to another recession.…”