QBE North America Unveils Insights on Cyber, Labor and Financial Challenges in 2024 Commercial Construction Risk Report
NEW YORK, May 14, 2024 /PRNewswire/ -- QBE North America today announced the release of its 2024 Commercial Construction Risk Report, uncovering key risks and emerging challenges within the commercial construction industry. Highlighting cybersecurity threats, financial challenges and labor shortage as significant concerns, the report sheds light on the industry's unique risks threatening project timelines, budgets and safety.
"Our goal was to identify and evaluate the primary risks threatening the success of commercial construction projects," said Ryan Powers, SVP, Head of Construction at QBE North America. "Through this report, we aim to highlight these critical concerns and examine the industry's level of preparedness in mitigating these key risks."
The report surveyed 500 commercial general contractors and construction managers. Key findings include:
-- Least prepared for the top risks: Survey respondents identified
cybersecurity (42%) as the industry's top risk, closely followed by
concerns over cost overruns (35%), high interest rates (33%), labor
shortage/lack of skilled labor (28%) and the potential for an economic
downturn (28%). Interestingly, these are the same risks that respondents
feel least prepared for and most vulnerable, signaling a pressing need
for enhanced risk mitigation strategies.
-- Managing rising costs is a challenge: Inflation, including the rise in
material and labor costs, can threaten project timelines and
profitability. Survey respondents identified high interest rates (40%)
and owner contract disputes (40%) as primary factors leading to cost
overruns.
-- Adopting new technology as cyber threats intensify: The industry is
adopting new technology to improve safety (46%), quality of work (46%),
and collaboration and efficiency (44%), but it must also address the
growing number of cyber vulnerabilities, exposures and threats.
-- The need for skilled labor outpaces the demand: The ongoing labor
shortage is impacting many trades, including electrical, HVAC, heavy
construction, among others. An aging workforce is contributing to the
widening gap of job openings and the availability of skilled labor.
Inexperienced workers may intensify issues related to work quality and
safety.
-- Risk management strategies can improve: Nearly half (49%) the survey
respondents intend to improve their safety plan over the next 12 months.
While risk management training is currently provided to employees,
survey respondents recognize that training needs to be of a higher
quality (55%) and more frequent (51%).
"There are a multitude of risks confronting the commercial construction industry, with new challenges emerging," Powers added. "Mitigating the potential impact of these risks requires an ongoing commitment and proactive measures to ensure a more efficient, safer and resilient future."
The 2024 Commercial Construction Risk Report from QBE North America highlights the need for the industry to strengthen its risk mitigation strategies. As emerging trends, new opportunities and innovation continue to shape the commercial construction landscape, identifying, evaluating and mitigating risks is critical.
Survey Methodology
The QBE Survey was conducted by Wakefield Research among 500 U.S. commercial general contractors and construction managers at companies with a minimum annual revenue of $20M USD, between March 11 and March 24, 2024, using an email invitation and an online survey. Results of any sample are subject to sampling variation. The magnitude of the variation is measurable and is affected by the number of interviews and the level of the percentages expressing the results. For the interviews conducted in this particular study, the chances are 95 in 100 that a survey result does not vary, plus or minus, by more than 4.4 percentage points from the result that would be obtained if interviews had been conducted with all persons in the universe represented by the sample.
About QBE
QBE North America is a global insurance leader helping customers solve unique risks, so they can stay focused on their future. Part of QBE Insurance Group Limited, QBE North America reported Gross Written Premiums in 2023 of $7.6 billion. QBE Insurance Group's results can be found at qbe.com. Headquartered in Sydney, Australia, QBE operates out of 27 countries around the globe, with a presence in every key insurance market. The North America division, headquartered in New York, conducts business primarily through its insurance company subsidiaries. The actual terms and conditions of any insurance coverage are subject to the language of the policies as issued. Additional information can be found at qbe.com/us or follow QBE North America on LinkedIn, Facebook and Instagram.
More information about QBE's Construction practice can be found at https://www.qbe.com/us/construction.
QBE makes no warranty, representation, or guarantee regarding the information herein or the suitability of these suggestions or information for any particular purpose. QBE hereby disclaims any and all liability concerning the information contained herein and the suggestions herein made. Moreover, it cannot be assumed that every acceptable risk transfer procedure is contained herein or that unusual or abnormal circumstances may not warrant or require further or additional risk transfer policies and/or procedures. The use of any of the information or suggestions described herein does not amend, modify, or supplement any insurance policy. Consult the actual policy or your agent for details about your coverage. QBE and the links logo are registered service marks of QBE Insurance Group Limited. © 2024 QBE Holdings, Inc.
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