VOICEThe The official magazine of The Construction Users Roundtable Issue 1, 2025 Y E A R SThe Construction Users Roundtable 3 WORDS OF WISDOM 5 This Issue’s Experts 7 A Message from Jim Ellis, CURT Chairman of the Board 8 Improving Productivity is not Optional: The Construction Industry Must Climb Out of its Productivity Rut. Why Hasn’t It? 11 Monetary Masala: It is Difficult to Know Whether 2025 Will be a Good Year – But one Thing is Clear – It Will be a Very Interesting One 16 Building a Resilient Workforce: The Impact of the Award-Winning Total Human Health Initiative. 19 AI Transformation: How Will Artificial Intelligence (AI) Transform Industrial Construction? 23 Spoiler Alert! People Really Do Want to Enter the Construction Trades 26 INDEX TO ADVERTISERS LEADERSHIP On the cover: CURT is thrilled to celebrate its 25th anniversary in 2025. This cover illustrates the many ways CURT has given voice to construction owners and the wider industry, through conferences, summits, panels, and networking opportunities. Your Subscription Your Way! Scan this QR code or email distribution@matrixgroupinc.net to subscribe or update your existing subscription information. Note, The VOICE is free for representatives of CURT member companies. FEATURESThe Construction Users Roundtable 5 Thank you to the contributors who shared their expertise this issue. THIS ISSUE’S EXPERTS Eric Dean is the General President of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, AFL-CIO (IW). As an accomplished ironworker, he worked for various contractors as a journeyman, foreman, and project superintendent throughout the Chicago area during his career. Kyle Kerestes is a Consultant for Continuum Capital. He is responsible for driving field productivity improvement within projects in the energy, utility, and industrial construction markets. Kyle is passionate about applying LEAN construction methodologies with his clients. Dr. Jan Mischke is a Partner at McKinsey & Company’s Global Institute (MGI), McKinsey’s business and economics research arm, based in Zurich. Since 2010, he has led MGI’s research on productivity and prosperity. Anirban Basu is Chairman & CEO of Sage Policy Group, an economic and policy consulting firm in Baltimore, Maryland. Dr. Basu is among the most recognizable economists, in part because of his consulting work on behalf of numerous clients, including prominent developers, bankers, brokerage houses, energy suppliers, law firms, and business associations. As part of the Operations Practice within McKinsey & Company’s Birgit Biemans specializes in manufacturing and capital projects, helping companies improve their production, asset productivity, and project delivery. Mark Bridgers is the Principal and Founder of Continuum Capital. He specializes in managing construction risk and consults to firms interested in mitigating infrequent and high-impact risks. His passion is helping organizations achieve breakthrough innovations through collaborative or integrated relationships. Greg Sizemore is Vice President, HSE and Workforce Development, at Associated Builders and Contractors (ABC). He directs ABC’s long- range strategic objectives related to creating an innovative, skilled, productive, healthy, and safe workforce. Kevin Stokvis is a Partner in McKinsey & Company’s Operations and Capital Excellence Practices, whose work focuses on performance transformation for natural-resource companies. His expertise draws on more than a decade of experience leading high-impact capital productivity and operational transformation projects. Koen Vermeltfoort helps lead McKinsey & Company’s Capital Excellence Practice in Europe, the Middle East, and Africa, working with clients to reverse the trend of increasing capital expenditure while boosting productivity and execution performance.Looking to grow your network and explore solutions in the construction industry? Join us in-person at the next CURT event, June 9th-12th, in Chicago. Choose from a variety of sprint teams to dive deep into key industry topics and collaborate with professionals. Don't miss out on this great opportunity! 2025 EVENT SCHEDULE NAPLES NOVEMBER 10TH -12TH CHICAGOCINCINNATI JUNE 9TH - 12THSEPTEMBER 15TH - 18TH ESG & Sustainability Technology & Productivity Procurement & Contracting Lean Project Delivery Talent Solutions Off Site Construction/ Modularization Construction Research Safety Unable to attend in-person, but still interested in joining a sprint team? Virtual meetings are held, too, at regular intervals. Contact Ronna DuBro, Director of Membership & Member Services, rdubro@curt.org or 513-981-2773The Construction Users Roundtable 7 WORDS OF WISDOM A message from the CURT Chairman of the Board. WORDS OF WISDOM We hope our excitement for the future inspires confidence, cultivates growth, and empowers our members to achieve bold goals. ‘ ‘ C elebrating a 25-year anniversary of any sort – birthday, marriage, career – is always a milestone of immense pride and significance. It marks a quarter-century of hard work, dedication, and growth, showcasing resilience through changing times. In 2025, the Construction Users Roundtable (CURT) is celebrating this milestone and I am truly honored to have been a part of this organization’s growth and success story. This achievement is a testament to the loyalty of our members, the passion of the people who make up our Sprint Teams, and the vision of all of our leaders, past and present. Let’s take a moment to honor the journey, reflect on challenges overcome, and celebrate successes earned. The theme for National Conference 2025 is People, Projects, Performance: 25 Years as the Voice of the Owner. We owe the success of CURT to our people. We believe that the work we have done has improved project outcomes for our members. We continue to work hard to improve the performance of the construction sector at large, while also sharing ideas and actions that benefit individual jobs. I’d like to add a fourth “p” to this list… perseverance. Persevering in the construction industry requires resilience, adaptability, and determination. It’s a field marked by fluctuating markets, demanding timelines, and unpredictable challenges, from weather delays to shifting regulations. Success depends on problem-solving skills, a commitment to safety and quality, and the ability to embrace innovation. Perseverance means pushing through obstacles, maintaining focus during downturns, and learning from setbacks. It’s about building strong relationships with clients, suppliers, and teams while fostering a reputation for reliability. Every completed project stands as a testament to hard work and grit. In this ever-evolving industry, perseverance turns challenges into opportunities and lays the foundation for lasting success. CURT’s members are experts at perseverance, and we are continually impressed by their determination to build amazing things, while demonstrating an impressive commitment to figuring out how to build safer, smarter, and more sustainably. Our members never rest on their laurels and for this, we are continuously impressed. As we reflect on 25 years gone by, and look towards CURT’s next decades, I can tell you that as an organization, we will also not rest on our laurels. Our leadership team is forward- thinking and innovative, and we are committed to driving success by embracing change, fostering creativity, and anticipating future trends. We hope our excitement for the future inspires confidence, cultivates growth, and empowers our members to achieve bold goals. As we welcome the new year, we embrace its opportunities with hope and excitement. I wish everyone success, growth, and fulfillment in the year ahead! CURT Celebrates 25 Years!8 Helping owners achieve the most productive use of every capital dollar. FEATURE The construction industry must climb out of its productivity rut. Why hasn’t it? T he construction industry could be on the brink of remarkable expansion: in constant prices, global construction spending is projected to escalate from $13 trillion in 2023 to a striking $22 trillion in 2040, which would require a CAGR of 3.2% (IHS Markit data). While this is no faster than the rapid China- driven expansion of the past two decades, outside of China, the industry will need to double its growth rate (from 1.3 to 2.7% CAGR) to deliver on the projections for 2040. The demand is clear, but how the construction industry will meet it, is not. The industry is lacking sufficient capable workers and economic labor productivity has stagnated for decades globally despite technological advancements and improvements by individual firms. Any shortfall in output would cause significant bottlenecks in country-level economic, social, and environmental ambitions. Building on the 2017 McKinsey report on construction productivity, Reinventing Construction Through a Productivity Revolution, this article aims to highlight the increasing urgency to bridge the gap between the construction industry’s lagging productivity and its role. The construction industry remains one of the world’s largest industries. In 2023, $13 trillion worth of gross annual output was devoted to construction projects globally, constituting 7% of global gross output. By 2040, the industry could grow by around 70%, but engineers and constructors in many parts of the world are struggling to deliver even today’s project pipeline. They’re already faced with tight labor markets for critical roles, and there is no evidence that the near-term labor market will be able to keep up with demand. An increase in productivity is needed to deliver projects with the same or fewer people per project. It would also create the financial space within construction companies to increase wages and invest in better tools and practices. The story of lagging construction productivity is an old one. Apart from selected economies, the issue has been perennial around the world for the past two decades. At the aggregate level, construction productivity improved by only 10% (0.4 percent annually) between 2000 and By Jan Mischke, Kevin Stokvis, and Koen Vermeltfoort, with Birgit Biemans, McKinsey is not Optional2022, compared to a 50% (2% annually) productivity improvement of the total economy and 90% (3% annually) productivity improvement for the manufacturing sector for the same period. From 2020 to 2022, productivity in the global construction industry has even declined by 8%. Whatever productivity growth there was in construction in the past decade mostly came from developing economies that have adopted foundational productivity practices, such as upskilling the workforce. Conversely, in the world’s most advanced economies, namely the United States and Europe, there has been virtually no progress. Related to low productivity growth, construction became 1 to 3% more expensive each year globally on top of general inflation (IHS Markit data). Between 2015 and 2023, construction prices (nonresidential) in the United States rose 52%, reaching double-digit growth rates in 2022 (U.S. Bureau of Labor Statistics, 2023). The obvious way to grow construction output amid stagnant productivity would be to hire more people, but the current labor market has pushed that option off the table in many economies and has added to concerns of escalating construction costs. As of 2020, the construction industry employed roughly 8% of the global workforce (International Labour Organization, 2020). In the United States, the average number of vacancies in construction almost doubled between 2017 and 2023, increasing from 200,000 to 380,000 across the industry (U.S. Bureau of Labor Statistics, 2023). In addition to shortages in the workforce, retirement, shorter job cycles, and competition for talent have caused a decline in the construction workforce’s skill and experience levels. At the current trajectory of stagnant productivity and slow or negative projected workforce growth, construction output might fall short of demand by $40 trillion cumulatively by 2040. In a more optimistic scenario, assuming countries can increase the average productivity by 1% annually on top of the trend of the past 20 years, and that the workforce grows in line with a high case scenario, the cumulative required spending on construction can be met, showing that if construction productivity can be improved, future demands can be met, which reinforces the necessity for countries to start promptly. While the sentiment in the sector suggests significant efforts have been made to improve productivity, the results don’t show for it. Many construction CEOs are perplexed by this data: they feel that because they have launched multiple initiatives and see improvements in their own companies, the industry overall must also see progress. The previously mentioned 2017 McKinsey report on construction productivity captures the causes behind the low productivity, many of which remain true. Technology uptake has been slow: The construction industry’s uptake of technology has been slow over the past several decades. Historically, construction companies spent an average of less than 1% of revenues on IT, less than a third of what is common, for example, in automotive and aerospace. Since 2020, the interest in technology in the architecture, engineering, and construction (AEC) industry has grown compared to the Next >