The impact of equipment technology on productivity in the U.S. construction industry

In general, U.S. industry has witnessed dramatic changes in the way it accomplishes its core processes over the past 25 years. Well-understood technological and managerial advances have allowed the manufacturing sector, for example, to steadily increase its productivity, and with it, its profit margins. In construction, related changes are far less well understood. Previous related research indicates that labor and partial factor productivity may in fact be increasing in the U.S. construction industry. This research examines the effect of technology, specifically equipment technology, on productivity. Changes in labor and partial factor productivity are analyzed for 200 activities from 1976 to 1998. During that same time period, changes in equipment technology are measured through economic measures, a technology index, and five technology factors of change, which are changes in control, energy, functional range, information processing, and ergonomics. Through ANOVA and regression analyses, it is found that changes in equipment technology have played a substantial role in changes in labor and partial factor productivity. The research also shows that changes in control, energy, and functional range have each lead to an added increase in labor productivity from 15 to 25% between 1976 and 1998 with similar increases in partial factor productivity. A review of existing literature on productivity and technical change and an anecdotal summary of construction manager’s experiences in these areas are also included in the study.