HW#01 - Construction Industry Overview

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California Polytechnic State University, San Luis Obispo *

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371-01

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Civil Engineering

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Dec 6, 2023

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CALIFORNIA POLYTECHNIC STATE UNIVERSITY Department of Civil and Environmental Engineering Course: CE-371-Construction Management and Project Planning Instructor: Hani Alzraiee Homework #01: Construction Industry Overview Total Points: 30 Individual Homework Purpose: The purpose of this homework is to explore the construction sector, its economic contribution, and the fundamentals of construction engineering and construction management. Students will better understand the steps to be a licensed Civil Engineer with a Construction Engineering focus in California. Economic Contribution: The U.S. economy, which follows the system of capitalism, includes consumption expenditures, or private consumer spending, government spending, and business investments. The construction sector, specifically, greatly contributes to the overall consumption of goods and services, and therefore, the national economy. In fact, according to an article written by Anthony Johnson, and released by Forbes magazine, a company focused on producing articles related to marketing subjects, “Construction is a driving force behind the U.S. economy, contributing 4% to the GDP…” of the year 2022 (Johnson, 2023). In addition to this, according to a report written by the Department of Commerce in the year 2018, the “…American Society of Civil Engineers estimates that the United States needs to invest $4.5 trillion infrastructure by 2025…,” proving that construction is not showing any signs of slowing down in the following year (BIS, 2018). The construction sector plays a vital role in keeping the American economy afloat with its continual demands for additional labor and materials; it is so essential to the nation’s economic well-being that any issue surrounding any aspect of the construction sector that could heavily impact the industry raises trepidation in the national security. The construction sector proves to be significant in upholding the nation’s economic resilience, especially with the recent pandemic that dominated the entire world. With the United States’ growing unemployment even prior to the covid crisis, the construction sector has continued to “…contribute greatly to employment rates because most construction projects involve labor-intensive processes…” (Hogan, 2020). In other words, in the past couple of years, the nation relied heavily on the job opportunities that the construction industry provided. As shown on Figure 1, for instance, the workloads by each sector in the construction industry dramatically increased beginning in the mid-2019 (AACE, 2022). On the other hand, Figure 2 shows the ever-increasing shortages on labor force beginning in the year 2019 (AACE, 2023). This proves that the construction industry plays a “…major role in stabilizing the economy…” by providing employment opportunities to “…a populous workforce of off-site and on-site workers…,” including “…other professionals such as secretaries, drivers, delivery men, accountants…” and other workers not “…directly involved in construction…” (Hogan, 2020). In addition, due to the attempts to reactivate various projects that were put on hold because of the covid scare that occurred, it increased the demand for construction, and therefore, there is HW #01 Page 1 of 7

an “…ongoing strength of workloads in the infrastructure space…,” as shown in Figure 1. These show the great contributions of the construction industry to the nation’s economy. Figure 1. Chart obtained from AACE International Q4 2022: Construction Monitor Figure 2. Chart obtained from AACE International Q2 2023: USA Construction Monitor HW #01 Page 2 of 7 Figure 1. Workloads by Sector Figure 2. Factors Hindering Activity

In addition to the increased job openings, the industry also provides employment opportunities to those of the other sectors, including transport, commerce, and manufacturing industries, through the procurement of services that offer the production, transport, and delivery of steel, aluminum, concrete, and other materials (Hogan, 2020). In light of this, the construction industry’s heavy reliance on steel production caught the attention of the U.S. Department of Commerce Bureau of Industry and Security, and decided that steel import, which made up 91% of the 36 million metric tons of steel products within the United States in the year 2017, as shown in Figure 3, “…[weakened the country’s]…internal economy…” and could potentially “…impair the national security” (BIS, 2018). It posed a threat to the domestic producers due to the excess of steel imports, “…[taking] business away…” and potentially causing it to “…exit the market and substantially close down production…” (BIS, 2018). In turn, Section 232 of the Trade Expansion Act of 1962 imposed tariffs on steel imports in an attempt to “…remove the threatened impairment to national security…” and provide more support for domestic steel production, which is directly impacted by the construction industry’s increasing need for steel products (BIS, 2018). As a result, not only does the construction sector HW #01 Page 3 of 7 Table 1. Top U.S. Imports of All Steel Products

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provide job opportunities to those in the construction industry, but also to those involved in the production of the materials needed for construction. These show that the construction sector plays an essential role in the growth and maintenance of the U.S. economy. Current and Future Challenges: According to recent studies conducted by the Association for the Advancement of Cost Engineering International, or AACE International, some of the current and future challenges that the construction industry is facing include constant labor and skill shortages, material shortages, and increasing material costs. As indicated in Figure 2, shown above, these shortages are considered hindrances in moving forward with construction activities (AACE, 2023). Figure 3 also shows more obstacles that are reported to remain as “key challenges” to construction (AACE, 2022). As shown, skill and labor shortages dominate the higher percentages, indicating the increased need for labor recruitments. Additionally, the constant increase in costs of materials also contribute to the challenges that the industry faces. According to Forbes magazine, construction prices also increased by 1.3% in the beginning of 2023 (Johnson, 2023). These rises in prices can be directly attributed to the growing shortage of materials, as also shown in Figure 3. These challenges could potentially delay current and future construction projects and negatively impact the industry’s ability to produce desired results. Construction Engineering vs. Construction Management: Although there are a lot of similarities between a construction manager and a construction engineer, the two roles have distinct differences, especially in their functions at a HW #01 Page 4 of 7 Figure 3. Obstacles to Activity in 2022 Figure 3. Chart obtained from AACE International Q4 2022: USA Construction Monitor

construction site. A construction manager is expected to be in charge of the overall planning and scheduling of the project, the procurement of necessary materials for the project, as well as making sure the project does not go over the budget indicated on the contract. Meanwhile, the construction engineer is expected to study the drawing plans from the design engineer and identify the necessary RFIs, to monitor critical changes on site that could potentially heavily impact the design of the project, as well as to have the ability to blend fundamental principles of engineering with the emergence of new and advanced technologies. PE Licensing: Obtaining a Professional Civil Engineering license (Construction) in California requires a series of steps from the creation of an account on NCEES.org, to the sending of application to the Board for Professional Engineers, Land Surveyors, and Geologists (BPELSG). It is important for one to first register for the Fundamentals of Engineering (FE) exam on NCEES and pass it. Once that is completed, one must make sure the FE exam has been verified on the NCEES account prior to registering for the Professional Engineering (PE) breadth and depth exam. Once the FE exam has been verified, one must schedule to take the PE exam. Once this exam has been completed and passed, they have to meet the requirements set by the BPELSG prior to applying to the Board. These requirements include the following:  B.S. Degree from an approved engineering curriculum  Have 24 months of qualifying work experience after the B.S. graduation date. After this, one can proceed to complete the application to be submitted to the Board. The Board requires various things in the application, which includes the work experience information completed by the applicant, and the work experience reference information to be completed by the professional reference. The Board also includes a number of requirements on who qualifies as a professional reference, including the absence of any relationship between the professional and the applicant by birth or marriage, unless another individual who is not a relative can verify the applicant’s employment. Once these qualifications have been met and the application is submitted, one can log-in to the BPELSG Connect to request to take the additional state- specific exams, specifically the Surveying Exam and the Seismic Exam. After completing these exams and passing them, licensure will be awarded by the Board (NCEES, n.d.). HW #01 Page 5 of 7

References Johnson, A. (n.d.). Council Post: Using Construction As An Economic Indicator . Forbes. Retrieved September 30, 2023, from https://www.forbes.com/sites/forbesbusinesscouncil/2023/08/16/using-construction-as- an-economic-indicator/?sh=5d76c4ce7bfa Department of Commerce. (2018). U.S. Department of Commerce Bureau of Industry and Security Office of Technology Evaluation: The Effects of Imports of Steel on the National Security . BIS. Accessed September 30, 2023. Hogan, P. (2020). 5 Ways Construction Will Supplement Economic Recovery and Growth . In P. Hogan (Ed.), One-Key. Handle. Handle.com RICS Economics. (2022). Q4 2022: USA Construction Monitor . AACE International; AACE International. https://web.aacei.org/ RICS Economics. (2023). Q1 2023: USA Construction Monitor . AACE International; AACE International. https://web.aacei.org/ RICS Economics. (2023). Q2 2023: USA Construction Monitor . AACE International; AACE International. https://web.aacei.org/ Office, U. S. G. A. (n.d.). Steel and Aluminum Tariffs: Agencies Should Ensure Section 232 Exclusion Requests Are Needed and Duties Are Paid | U.S. GAO. www.gao.gov . https://www.gao.gov/products/gao-23-105148#:~:text=In%20March%202018%2C %20citing%20national PE Exam. (n.d.). NCEES. Retrieved September 30, 2023, from https://ncees.org/exams/pe- exam/#california 1. Guidelines: (5 points) a. APA in-text citation b. Paper Length – The paper should not be less than 1200 words (excluding references) to cover all points. Students are encouraged to add graphs or charts to support the data presented. c. Address all four points in question 1. Organize your paper sections per heading. d. Submission : Submit your work through Canvas as a single Word file. Filename (Name#_HW Heading). HW #01 Page 6 of 7

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HW#01 - Construction Industry Overview

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