QBE North America Unveils Insights on Cyber, Labor and Financial Challenges in 2024 Commercial Construction Risk Report

QBE North America has released 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.

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 provided to employees, survey respondents recognize that training needs to be of a higher quality (55%) and more frequent (51%).