The downward trend of productivity falling in the U.S. construction industry fell 30% between 1970 and 2024, while overall labor productivity more than doubled. A report from leading investment banking, securities, and asset and wealth management firm Goldman Sachs explains why the U.S. construction industry is trailing behind countries’ construction industries.
One reason Goldman Sachs attributes to the trend is the limited gains in industry innovation. They cited that most construction materials and tools first originated in the 1950s. The industry has yet to fully take advantage of recent technologies despite the increased use of drones, 3-D printing and AI, the full potential of these technologies is not unleashed. The firm also cites increased housing regulation tightening the industry. Concerning factors delaying productivity include approval delays, design restrictions, impact fees and political involvement.
