More Than Half Of Construction Companies Plan To Increase Fleet Size Amidst Rising Demand, Despite Growing Labour Shortage
Increasing demand for services is putting pressure on talent acquisition, with construction companies turning to technology to forecast hiring, manage costs, and grow revenue
Sydney, Australia, August 21, 2018 – Teletrac Navman, a global software-as-a-service provider that leverages location-based technology for GPS fleet tracking and fleet management solutions, today released findings from its second annual Telematics Benchmark Report: Global Construction Edition.
The research reveals that construction businesses are facing several challenges, despite growing demand for services. Managing costs (49%) remains the industry’s biggest challenge. However, issues around finding, retaining and developing talent have grown significantly from last year, with more than a third (35%) of businesses affected, up 13 per cent on 2017.
The industry’s growing focus on risk management and compliance has also resulted in a more respondents facing challenges around minimising vehicle/driver incidents (23%), up 6 per cent; managing risk (21%), up 7 per cent; and regulatory changes (17%), up 10 per cent.
Despite these challenges, the construction industry is expected to grow at 4.2 per cent from 2018 to 20231, and to be worth $15.5 trillion2 globally by 2030. In line with this, over half of respondents (59%) said they expect to grow fleet sizes next year to cope with rising demand for services (56%). This echoes research by ACA Research3, which found that 60 per cent of Australian construction firms will increase fleet sizes next year
The survey also revealed the extent of the current labour shortage, technology disruption, and economic optimism, in addition to several other key trends.
Rising global demand is leading to labour shortages and higher costs, with payroll dominating company expenses as firms increase pay and offer greater benefits to attract talent
- Finding, retaining and developing talent is the biggest planned business investment (42%), with just under half (49%) saying that increasing material and labour costs was their biggest concern.
- Organisations are addressing the labour shortage by increasing pay (50%), offering better benefits (35%), and providing flexible working arrangements (29%).
Construction firms are turning to technology to manage issues, improve efficiency and results
- After talent, upgrading fleets (37%), integrating technologies and systems (33%), installing more efficient GPS tracking (26%), and implementing technology for regulatory compliance (22%) are key investment priorities in the year ahead.
- More than three quarters (79%) of respondents are using telematics, with 55 per cent reporting fuel savings as a result (12% fuel saved on average). In Australia, ACA research has found that nearly one third (29%) are using telematics, with the construction industry having the second highest intention of using telematics in the next year (37%), of the seven industries surveyed4.
- The reasons for deploying telematics include: vehicle/equipment tracking (76%), tracking speed (62%), hours driven (58%) and distance (47%). Reducing idling (39%) and fuel usage (32%) were also key drivers.
Early adopters are reaping rewards, with a range of benefits from fleet management technology
- The top reported benefits of telematics included: peace of mind/knowing where vehicles are (57%); improved driver behaviour (34%); more efficient routing (24%); and cost savings (19%).
- Construction firms have also already embraced mobile technology, with 58 per cent of business offering it to their drivers, operators, and fleet managers, to enable more direct communication (57%); easier fleet tracking (48%), and easier reporting (46%).
Commenting on the findings, James French, Construction Equipment Solutions Specialist, Teletrac Navman Australia, said: “The construction industry has long faced pressures to do more with less, while also ensuring the safety of its workers and profitability of the business”.
“With costs rising, it’s no surprise that many construction fleets are turning to modern technologies, such as telematics, to find efficiencies. Firms also reported a notable upswing on 2017 in facing challenges around regulatory requirements and compliance. This suggests that new laws such as the upcoming changes to the Australian Chain of Responsibility legislation are top of mind for many construction companies. We’re committed to supporting the industry by helping them understand and navigate these market shifts,” Mr French continued.
The full report can be found at: Telematics Benchmark Report: Global Construction Edition
The 2018 Teletrac Navman Telematics Benchmark Report is based on a survey of more than 2,400 fleet operations and fleet management professionals from around the world. Of the total survey respondents, 646 indicated that their primary industry was construction, mining or oil and gas. This includes over 120 from ANZ. The results described in the 2018 Telematics Benchmark Survey: Global Construction Edition, were compiled from those respondents
About Teletrac Navman
Teletrac Navman is a leading software-as-a-service (SaaS) provider leveraging location-based technology and services for managing mobile assets. With specialised solutions that deliver greater visibility into real-time insights and analytics, Teletrac Navman helps companies make better business decisions that enhance productivity and profitability. Its fleet and asset management technology uncovers information that would otherwise go unseen, helping customers reduce risk and confidently move their business forward with certainty. It tracks and manages more than 500,000 vehicles and assets for more than 40,000 companies around the world. The company is headquartered in Glenview, IL, with additional offices in the United States, United Kingdom, Australia, New Zealand and Mexico. For more information visit teletracnavman.com.
Fred Azis-Laranjo, Spectrum Group
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3 Corporate Fleet Telematics Insight Report, July 2018 ACA Research
4 Corporate Fleet Telematics Insight Report, July 2018 ACA Research