Four Key Takeaways from Anchin's State of the Construction Industry Event

October 16, 2017

The annual Anchin State of the Construction Industry event brought together major players in the construction community to discuss issues impacting the sector in New York City. Here, Construction partner Laurie Stanziale explores some of the conference's key takeaways.

1.) While the high cost of construction in NYC continues to have an impact, the large amount of Generation Z and Millennials in the workforce is the true force driving construction. The continued desire of the young workforce to live and work in NYC is the underpinning to the continued success of development. Nevertheless, construction companies' costs of construction are causing repositioning, margins of profits are being squeezed and there are shortages of labor. We are seeing responses to cost issues with the influx of open shop jobs.

2.) Despite being one of the most sophisticated and densely populated cities in the United States, the Big Apple lags behind other cities and countries in innovations in design and methods of construction. The team of FXFOWLE and Thornton Tomasetti, spoke about how they utilized a design to allow concrete cores to be installed ahead of steel frames. They advised that it was a big challenge to get this design technique approved, although it is used many other cities. Design-Bid-Build (DBB) method of project delivery which is most commonly used in New York City is antiquated. The idea of Integrated Project Delivery (IPD), which keeps stakeholders on the same sides of the table and Design-Build (DB), which gets the design and contractors together sooner, are proven methods which increase efficiency, and reduce costs and time. Unfortunately, there is a continuing lack of trust and willingness to change that hinder the use of DB and IPD in New York City.

3.) Subway ridership of both the young and old is on the rise in New York City. The managing director of the Metropolitan Transportation Authority said that the MTA has the largest budget ever at $32.5 billion. The MTA is devising ways to respond to the increased ridership needs of the Generation Z and Millennial population, who are also settling in the outer boroughs, creating more of a need for public transportation in those areas now. In addition, more people are retiring in NYC than in years past, creating a greater demand for public transportation for seniors. As a result, the MTA is undertaking improvements in stations, such as improving subway cars (imagine open cars, enhanced lighting, elevators and escalators, and wider doors and entrances) like in many metropolitan cities around the world.

4.) Changes in U.S. immigration policies will have an effect on design and engineering talent. Many of the design and technical experts that architecture and engineering firms hire come from other countries. The ever-changing, and often restrictive immigration policies of the current administration are posing new challenges to keeping good talent here and may impact the ability of new talent to enter the United States if the roadblocks to an H-1B visa or other means of entry become impassable.

Our Construction practice will continue to keep clients updated on relevant issues impacting the sector. Read some of Laurie's other legal updates on important issues facing the construction industry.

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