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65-589: The Building Cost Information Service ( BCIS ) provides cost and price data for the UK construction industry . Founded as part of the Royal Institution of Chartered Surveyors (RICS), it is now a standalone company. BCIS was set up in 1961 to provide the profession with cost information in elemental format and to promote the use of elements and of elemental cost planning . The BCIS "Standard Form of Cost Analysis" (SFCA) remained an industry staple, largely unchanged, until
130-476: A designer , a contractor , a construction manager , or other advisors); such specialists are normally appointed for their expertise in project delivery and construction management and will help the owner define the project brief , agree on a budget and schedule , liaise with relevant public authorities, and procure materials and the services of other specialists (the supply chain , comprising subcontractors and materials suppliers). Contracts are agreed for
195-422: A "live" environment (where residents or businesses remain living in or operating on the site) requires particular care, planning and communication. When applicable, a proposed construction project must comply with local land-use planning policies including zoning and building code requirements. A project will normally be assessed (by the 'authority having jurisdiction', AHJ, typically the municipality where
260-445: A building or other asset that affect safety, including its use, expansion, structural integrity, and fire protection , usually require municipality approval. Depending on the type of project, mortgage bankers , accountants , and cost engineers may participate in creating an overall plan for the financial management of a construction project. The presence of the mortgage banker is highly likely, even in relatively small projects since
325-640: A business to lead both design and construction ( design-build ); or they may directly appoint a designer, contractor and specialist subcontractors ( construction management ). Some forms of procurement emphasize collaborative relationships ( partnering , alliancing) between the client, the contractor, and other stakeholders within a construction project, seeking to ameliorate often highly competitive and adversarial industry practices. DfMA (design for manufacture and assembly) approaches also emphasize early collaboration with manufacturers and suppliers regarding products and components. Construction or refurbishment work in
390-479: A conceptual cost estimate performed by a building estimator . As portions of a project are completed, they may be sold, supplanting one lender or owner for another, while the logistical requirements of having the right trades and materials available for each stage of the building construction project carry forward. Public–private partnerships (PPPs) or private finance initiatives (PFIs) may also be used to help deliver major projects. According to McKinsey in 2019,
455-433: A rule is inapplicable (the bridge design will not cause a collapse), or that the custom is no longer needed (acceptance of live-work spaces has grown in the community). During the construction of a building, a municipal building inspector usually inspects the ongoing work periodically to ensure that construction adheres to the approved plans and the local building code. Once construction is complete, any later changes made to
520-460: A unique business with a registered U.S. headquarters, was determined by the industry appropriate for the overall largest product lines of the company or organization of which the establishment was a part. The later NAICS classification system has a different concept, assigning establishments into categories based on each one's output. The first edition of SIC was published in parts during 1938–1940, with revisions made in 1941–1942. The next edition
585-571: Is a system for classifying industries by a four-digit code as a method of standardizing industry classification for statistical purposes across agencies. Established in the United States in 1937, it is used by government agencies to classify industry areas. Similar SIC systems are also used by agencies in other countries, e.g., by the United Kingdom 's Companies House . In the United States,
650-405: Is the discipline of safely and efficiently tearing down buildings and other artificial structures . Demolition contrasts with deconstruction , which involves taking a building apart while carefully preserving valuable elements for reuse purposes ( recycling – see also circular economy ). The output of the global construction industry was worth an estimated $ 10.8 trillion in 2017, and in 2018
715-937: Is the process of adding structures to areas of land, also known as real property sites. Typically, a project is instigated by or with the owner of the property (who may be an individual or an organisation); occasionally, land may be compulsorily purchased from the owner for public use. Residential construction may be undertaken by individual land-owners ( self-built ), by specialist housebuilders , by property developers , by general contractors , or by providers of public or social housing (e.g.: local authorities, housing associations ). Where local zoning or planning policies allow, mixed-use developments may comprise both residential and non-residential construction (e.g.: retail, leisure, offices, public buildings, etc.). Residential construction practices, technologies , and resources must conform to local building authority's regulations and codes of practice . Materials readily available in
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#1733084923778780-413: Is the second largest construction market with a 2018 output of $ 1.581 trillion. Construction is a major source of employment in most countries; high reliance on small businesses, and under-representation of women are common traits. For example: According to McKinsey research, productivity growth per worker in construction has lagged behind many other industries across different countries including in
845-550: The Bronze Age , a class of professional craftsmen , like bricklayers and carpenters , appeared. Occasionally, slaves were used for construction work. In the Middle Ages , the artisan craftsmen were organized into guilds . In the 19th century, steam-powered machinery appeared, and later, diesel- and electric-powered vehicles such as cranes , excavators and bulldozers . Fast-track construction has been increasingly popular in
910-482: The Latin word constructio (from com- "together" and struere "to pile up") and Old French construction . To 'construct' is a verb : the act of building, and the noun is construction: how something is built or the nature of its structure. In its most widely used context, construction covers the processes involved in delivering buildings , infrastructure , industrial facilities, and associated activities through to
975-476: The United States and in European countries. In the United States, construction productivity per worker has declined by half since the 1960s. The twenty-five largest countries in the world by construction GVA (2018) Some workers may be engaged in manual labour as unskilled or semi-skilled workers; they may be skilled tradespeople; or they may be supervisory or managerial personnel. Under safety legislation in
1040-474: The architect , engineer or builder acts for the client as the project coordinator. They design the works, prepare specifications and design deliverables (models, drawings, etc.), administer the contract, tender the works, and manage the works from inception to completion. In parallel, there are direct contractual links between the client and the main contractor, who, in turn, has direct contractual relationships with subcontractors. The arrangement continues until
1105-414: The type of building , non-residential building construction can be procured by a wide range of private and public organisations, including local authorities, educational and religious bodies, transport undertakings, retailers, hoteliers, property developers, financial institutions and other private companies. Most construction in these sectors is undertaken by general contractors . Civil engineering covers
1170-581: The "vast majority of large construction projects go over budget and take 20% longer than expected". A construction project is a complex net of construction contracts and other legal obligations, each of which all parties must carefully consider. A contract is the exchange of a set of obligations between two or more parties, and provides structures to manage issues. For example, construction delays can be costly, so construction contracts set out clear expectations and clear paths to manage delays. Poorly drafted contracts can lead to confusion and costly disputes. At
1235-461: The 21st century. Some estimates suggest that 40% of construction projects are now fast-track construction. Broadly, there are three sectors of construction: buildings, infrastructure and industrial: The industry can also be classified into sectors or markets. For example, Engineering News-Record ( ENR ), a US-based construction trade magazine, has compiled and reported data about the size of design and construction contractors. In 2014, it split
1300-447: The 21st-century introduction of building information modeling (BIM) processes has involved the use of computer-generated models that can be used in their own right or to generate drawings and other visualisations as well as capturing non-geometric data about building components and systems. On some projects, work on-site will not start until design work is largely complete; on others, some design work may be undertaken concurrently with
1365-452: The SIC defines these employees as part of the "Basic Sector" of manufacturing jobs when they should be reported as "Non-Basic." Secondly, SIC codes were developed for traditional industries prior to 1970. Business has changed considerably since then from manufacturing-based to mostly service-based. As a result, and thirdly the SIC has been slow to recognize new and emerging industries, such as those in
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#17330849237781430-553: The SIC system was last revised in 1987 and was last used by the Census Bureau for the 1992 Economic Census, and has been replaced by the North American Industry Classification System (NAICS code), which was released in 1997. Some U.S. government departments and agencies, such as the U.S. Securities and Exchange Commission (SEC), continue to use SIC codes. The SIC code for an establishment, that is,
1495-506: The Standard Industrial Classification system was born. SIC codes are four-digit numerical representations of major businesses and industries. SIC codes are assigned based on common characteristics shared in the products, services, production and delivery system of a business. SIC codes have a hierarchical, top-down structure that begins with general characteristics and narrows down to the specifics. The first two digits of
1560-585: The United Kingdom, for example, construction workers are defined as people "who work for or under the control of a contractor on a construction site"; in Canada, this can include people whose work includes ensuring conformance with building codes and regulations, and those who supervise other workers. Laborers comprise a large grouping in most national construction industries. In the United States, for example, in May 2021
1625-566: The United States in 1997 and in Mexico one year later. NAICS classified establishments (workplace) by their main output, instead of classifying them with the larger firm or organization of which the establishment was a part. This gives more precise information on establishment and worker activities than the SIC system, but changed the meaning of the classifications somewhat, making some time series of data hard to sustain accurately. Fort and Klimek (2016) found using longitudinal data on establishments that
1690-413: The area generally dictate the construction materials used (e.g.: brick versus stone versus timber ). Costs of construction on a per square meter (or per square foot) basis for houses can vary dramatically based on site conditions, access routes, local regulations, economies of scale (custom-designed homes are often more expensive to build) and the availability of skilled tradespeople. Depending upon
1755-554: The asset as an advanced technological system requiring close integration of many sub-systems and their individual components, including sustainability. For buildings, building engineering is an emerging discipline that attempts to meet this new challenge. Traditionally, design has involved the production of sketches , architectural and engineering drawings , and specifications . Until the late 20th century, drawings were largely hand- drafted ; adoption of computer-aided design (CAD) technologies then improved design productivity, while
1820-419: The budget on the job, and a construction manager , design engineer , construction engineer or architect supervises it. Those involved with the design and execution must consider zoning requirements and legal issues, environmental impact of the project, scheduling , budgeting and bidding , construction site safety , availability and transportation of building materials , logistics, and inconvenience to
1885-447: The client enters into separate contracts with the designer (architect or engineer), a construction manager , and individual trade contractors . The client takes on the contractual role, while the construction or project manager provides the active role of managing the separate trade contracts, and ensuring that they complete all work smoothly and effectively together. This approach is often used to speed up procurement processes, to allow
1950-410: The client greater flexibility in design variation throughout the contract, to enable the appointment of individual work contractors, to separate contractual responsibility on each individual throughout the contract, and to provide greater client control. In the industrialized world, construction usually involves the translation of designs into reality. Most commonly (i.e.: in a design-bid-build project),
2015-429: The code represent the major industry sector to which a business belongs. The third and fourth digits describe the sub-classification of the business group and specialization, respectively. For example, "36" refers to a business that deals in "Electronic and Other Equipment." Adding "7" as a third digit to get "367" indicates that the business operates in "Electronic, Component and Accessories." The fourth digit distinguishes
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2080-503: The computer, software, and information technology sectors. The SIC codes can be grouped into progressively broader industry classifications: industry group, major group, and division. The first 3 digits of the SIC code indicate the industry group, and the first two digits indicate the major group. Each division encompasses a range of SIC codes: To look at a particular example of the hierarchy, SIC code 2024 (ice cream and frozen desserts) belongs to industry group 202 (dairy products), which
2145-665: The construction sector employed just over 7.5 million people, of whom just over 820,000 were laborers, while 573,000 were carpenters , 508,000 were electricians , 258,000 were equipment operators and 230,000 were construction managers. Like most business sectors, there is also substantial white-collar employment in construction – 681,000 US workers were recorded by the United States Department of Labor as in 'office and administrative support occupations' in May 2021. Large-scale construction requires collaboration across multiple disciplines. A project manager normally manages
2210-493: The current industrial climate. The result was the North American Industry Classification System , or NAICS, a collaborative effort between Canada, the U.S. and Mexico. NAICS replaced the four-digit SIC code with a six-digit code, and it provided more flexibility in handling emerging industries (for example, the NAICS system more generally allows for "Other..." categories across industry groups). The new codes were implemented in Canada and
2275-750: The data into nine market segments: transportation, petroleum , buildings, power, industrial, water, manufacturing, sewage/waste, telecom , hazardous waste , and a tenth category for other projects. ENR used data on transportation, sewage, hazardous waste and water to rank firms as heavy contractors. The Standard Industrial Classification and the newer North American Industry Classification System classify companies that perform or engage in construction into three subsectors: building construction, heavy and civil engineering construction, and specialty trade contractors. There are also categories for professional services firms (e.g., engineering , architecture , surveying , project management ). Building construction
2340-426: The delivery of services by all businesses, alongside other detailed plans aimed at ensuring legal, timely, on-budget and safe delivery of the specified works. Design, finance, and legal aspects overlap and interrelate. The design must be not only structurally sound and appropriate for the use and location, but must also be financially possible to build, and legal to use. The financial structure must be adequate to build
2405-409: The descriptions provided by employers under the primary business activity entry on employer ID applications. Over the years, the U.S. Census has identified three major limitations to using the SIC system. The first limitation surrounds its definition and mistaken classification of employee groups. For example, administrative assistants in the automotive industry support all levels of the business, yet
2470-440: The design provided and must pay amounts that are legally owed. Legal structures integrate design with other activities and enforce financial and other construction processes. These processes also affect procurement strategies. Clients may, for example, appoint a business to design the project, after which a competitive process is undertaken to appoint a lead contractor to construct the asset ( design–bid–build ); they may appoint
2535-451: The design team is employed by (i.e. in contract with) the property owner. Depending upon the type of project, a design team may include architects , civil engineers , mechanical engineers , electrical engineers , structural engineers , fire protection engineers , planning consultants , architectural consultants, and archaeological consultants. A 'lead designer' will normally be identified to help coordinate different disciplinary inputs to
2600-821: The design, construction, and maintenance of the physical and naturally built environment , including public works such as roads, bridges, canals, dams, tunnels, airports, water and sewerage systems, pipelines, and railways. Some general contractors have expertise in civil engineering; civil engineering contractors are firms dedicated to work in this sector, and may specialise in particular types of infrastructure. Industrial construction includes offshore construction (mainly of energy installations: oil and gas platforms , wind power ), mining and quarrying , refineries , breweries , distilleries and other processing plants, power stations , steel mills , warehouses and factories . Some construction projects are small renovations or repair jobs, like repainting or fixing leaks, where
2665-443: The desire to prevent indisputably bad phenomena, e.g. explosions or bridge collapses. Other legal requirements come from malum prohibitum considerations, or factors that are a matter of custom or expectation, such as isolating businesses from a business district or residences from a residential district. An attorney may seek changes or exemptions in the law that governs the land where the building will be built, either by arguing that
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2730-535: The early stages of on-site activity (for example, work on a building's foundations may commence while designers are still working on the detailed designs of the building's internal spaces). Some projects may include elements that are designed for off-site construction (see also prefabrication and modular building ) and are then delivered to the site ready for erection, installation or assembly. Once contractors and other relevant professionals have been appointed and designs are sufficiently advanced, work may commence on
2795-467: The end of their life. It typically starts with planning , financing , and design that continues until the asset is built and ready for use. Construction also covers repairs and maintenance work, any works to expand, extend and improve the asset, and its eventual demolition , dismantling or decommissioning . The construction industry contributes significantly to many countries' gross domestic products ( GDP ). Global expenditure on construction activities
2860-505: The first Standard Industrial Classification for the United States. The SIC system was last revised in 1987 and was last used by the Census Bureau for the 1992 Economic Census. The Office of Management and Budget , or OMB, was tasked with revising the SIC system to reflect changing economic conditions. The OMB established the Economic Classification Policy Committee in 1992 to develop a new system representative of
2925-412: The first feature of the permanent structure has been put in place, such as pile driving, or the pouring of slabs or footings. Commissioning is the process of verifying that all subsystems of a new building (or other assets) work as intended to achieve the owner's project requirements and as designed by the project's architects and engineers. A period after handover (or practical completion) during which
2990-569: The late 2000s. In 2012 the "New Rules of Measurement" for cost management throughout the construction process were accompanied by a modernised version of the SFCA. In 2022, the BCIS was spun out of RICS. The BCIS approach is the most popular costing method employed by quantity surveyors in the UK. Construction industry Construction is a general term meaning the art and science of forming objects , systems , or organizations . It comes from
3055-486: The overall budget is adequate, presenting a temporary issue. Cost overruns with government projects have occurred when the contractor identified change orders or project changes that increased costs, which are not subject to competition from other firms as they have already been eliminated from consideration after the initial bid. Fraud is also an issue of growing significance within construction. Large projects can involve highly complex financial plans and often start with
3120-441: The overall design. This may be aided by integration of previously separate disciplines (often undertaken by separate firms) into multi-disciplinary firms with experts from all related fields, or by firms establishing relationships to support design-build processes. The increasing complexity of construction projects creates the need for design professionals trained in all phases of a project's life-cycle and develop an appreciation of
3185-409: The owner may act as designer, paymaster and laborer for the entire project. However, more complex or ambitious projects usually require additional multi-disciplinary expertise and manpower, so the owner may commission one or more specialist businesses to undertake detailed planning, design, construction and handover of the work. Often the owner will appoint one business to oversee the project (this may be
3250-405: The owner may identify any shortcomings in relation to the building specification ('defects'), with a view to the contractor correcting the defect. Maintenance involves functional checks, servicing, repairing or replacing of necessary devices, equipment, machinery , building infrastructure, and supporting utilities in industrial, business, governmental, and residential installations. Demolition
3315-478: The owner's equity in the property is the most obvious source of funding for a building project. Accountants act to study the expected monetary flow over the life of the project and to monitor the payouts throughout the process. Professionals including cost engineers, estimators and quantity surveyors apply expertise to relate the work and materials involved to a proper valuation. Financial planning ensures adequate safeguards and contingency plans are in place before
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#17330849237783380-414: The project brief and then selects a preferred supplier. Often this will be a consortium involving a design firm and a contractor (sometimes more than one of each). In the United States, departments of transportation usually use design-build contracts as a way of progressing projects where states lack the skills or resources, particularly for very large projects. In a construction management arrangement,
3445-435: The project is ready for handover. Design-build became more common from the late 20th century, and involves the client contracting a single entity to provide design and construction. In some cases, the design-build package can also include finding the site, arranging funding and applying for all necessary statutory consents. Typically, the client invites several Design & Build (D&B) contractors to submit proposals to meet
3510-405: The project is started, and ensures that the plan is properly executed over the life of the project. Construction projects can suffer from preventable financial problems. Underbids happen when builders ask for too little money to complete the project. Cash flow problems exist when the present amount of funding cannot cover the current costs for labour and materials; such problems may arise even when
3575-518: The project site. Typically, a construction site will include a secure perimeter to restrict unauthorised access, site access control points, office and welfare accommodation for personnel from the main contractor and other firms involved in the project team, and storage areas for materials, machinery and equipment. According to the McGraw-Hill Dictionary of Architecture and Construction's definition, construction may be said to have started when
3640-745: The project will be located) for its potential impacts on neighbouring properties, and upon existing infrastructure (transportation, social infrastructure, and utilities including water supply, sewerage, electricity, telecommunications, etc.). Data may be gathered through site analysis , site surveys and geotechnical investigations . Construction normally cannot start until planning permission has been granted, and may require preparatory work to ensure relevant infrastructure has been upgraded before building work can commence. Preparatory works will also include surveys of existing utility lines to avoid damage-causing outages and other hazardous situations. Some legal requirements come from malum in se considerations, or
3705-583: The public, including those caused by construction delays . Some models and policy-making organisations promote the engagement of local labour in construction projects as a means of tackling social exclusion and addressing skill shortages. In the UK, the Joseph Rowntree Foundation reported in 2000 on 25 projects which had aimed to offer training and employment opportunities for locally based school leavers and unemployed people. The Foundation published "a good practice resource book" in this regard at
3770-647: The same time. Use of local labour and local materials were specified for the construction of the Danish Storebaelt bridge , but there were legal issues which were challenged in court and addressed by the European Court of Justice in 1993. The court held that a contract condition requiring use of local labour and local materials was incompatible with EU treaty principles . Later UK guidance noted that social and employment clauses, where used, must be compatible with relevant EU regulation. Employment of local labour
3835-555: The specific industry sector, so a code of "3672" indicates that the business is concerned with "Printed Circuit Boards." The U.S. Census Bureau , Bureau of Labor Statistics , Internal Revenue Service and Social Security Administration utilize SIC codes in their reporting, although SIC codes are also used in academic and business sectors. The Bureau of Labor Statistics updates the codes every three years and uses SIC to report on work force, wages and pricing issues. The Social Security Administration assigns SIC codes to businesses based on
3900-473: The start of a project, legal advisors seek to identify ambiguities and other potential sources of trouble in the contract structures, and to present options for preventing problems. During projects, they work to avoid and resolve conflicts that arise. In each case, the lawyer facilitates an exchange of obligations that matches the reality of the project. Design-bid-build is the most common and well-established method of construction procurement. In this arrangement,
3965-566: The switch from SIC to NAICS reclassified large numbers of workers differently by industry/sector than NAICS does, notably by reclassifying some from the Manufacturing sector into Services. In the early 1900s, each branch of United States government agencies conducted business analysis using its own methods and metrics, unknown and meaningless to other branches. In the 1930s, the government needed standardized and meaningful methods to measure, analyze and share data across its various agencies. Thus,
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#17330849237784030-588: Was about $ 4 trillion in 2012. In 2022, expenditure on the construction industry exceeded $ 11 trillion a year, equivalent to about 13 percent of global GDP . This spending was forecasted to rise to around $ 14.8 trillion in 2030. The construction industry promotes economic development and brings many non-monetary benefits to many countries, but it is one of the most hazardous industries. For example, about 20% (1,061) of US industry fatalities in 2019 happened in construction. The first huts and shelters were constructed by hand or with simple tools. As cities grew during
4095-455: Was forecast to rise to $ 12.9 trillion by 2022, and to around $ 14.8 trillion in 2030. As a sector, construction accounts for more than 10% of global GDP (in developed countries , construction comprises 6–9% of GDP), and employs around 7% of the total employed workforce around the globe (accounting for over 273 million full- and part-time jobs in 2014). Since 2010, China has been the world's largest single construction market. The United States
4160-633: Was identified as one of several social issues which could potentially be incorporated in a sustainable procurement approach, although the interdepartmental Sustainable Procurement Group recognised that "there is far less scope to incorporate [such] social issues in public procurement than is the case with environmental issues". There are many routes to the different careers within the construction industry. There are three main tiers of construction workers based on educational background and training, which vary by country: Standard Industrial Classification The Standard Industrial Classification (SIC)
4225-637: Was published in two parts in 1945 and 1949. Further revisions were issued in 1957, 1963, 1967, 1972, 1977, and 1987. The SIC code system has been used since the 1930s. It was developed by the Interdepartmental Committee on Industrial Statistics, established by the Central Statistical Board who developed the List of Industries for manufacturing, published in 1938, and the 1939 List of Industries for non-manufacturing industries, which became
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