When considering a career in construction, you have to understand that it is indeed a risky business in many different ways. No matter what area of construction you’re working in, each project is going to come with its own unique set of challenges as well as opportunities, but being able to identify and manage those risks is what’s tricky for most people, but definitely not an impossible feat.
The thing about the risks associated with construction is that they’re not always bad. True enough, risks can totally disrupt and derail an entire project, but if you can effectively identify and manage those risks, you’ll grow your profits, establish positive relationships with clients that acquire you more new clients, and you’ll be able to expand your business into new sectors and markets.
Take a look at some of the biggest risks in the construction industry.
Keeping you and your workers safe should be your number one concern for every project and on every jobsite. Everything from site conditions changing and weather to unexpected hazards and mishaps, major accidents can happen at any given time and result in serious injuries and sometimes fatalities.
According to ehstoday.com, two construction workers die each day from work-related injuries in the US, on average. The top causes of these work-related injuries are due to what’s called the Fatal Four, which includes getting stuck between objects, electrocution, falls, and getting struck by an object.
As the owner of your construction business, it’s up to you to ensure your workers are safe. That means providing your workers with personal protective equipment so they can safely do their jobs, incorporating engineering controls, and investing in safety training sessions to keep them up-to-date and current on all safety measures. You also need to make sure your business is covered by insurance for that very reason.
How many times have you seen people hire so-called “contractors” to work on projects when you know they’re not licensed? You see it all the time. That’s because there are people who have the skills and talents to do construction and contract work but feel that they don’t need to get licensed for it.
The temptation of working as an unlicensed contractor is the risk because it is fairly easy to do, especially if you’re doing local residential work. But operating without a license is not only illegal, it also puts a limitation on the work you can do.
For example, if you live in Texas and want to get into the electrical, plumbing, and HVAC areas of construction, you’re not going to be able to do that without obtaining a Texas electrical license and continuing education. The more complex your projects become, the more education and training are going to be required of you, so don’t try to take the “easy” way out… Operating without a license is an unnecessary risk that could put your career on hold for potentially a lifetime.
A change order is simply a change to the original construction contract or jurisdiction of work; this is also known as an addendum or amendment. This is something to be expected in construction, but if not managed properly, it can wreak havoc on the completion of your project.
When change orders happen, it can lead to delays in contract milestones, workflow interruptions, and increased costs to complete the project. In other words, change orders, ultimately, are a major cause of projects not being completed on time.
True enough there are certain circumstances that are out of your control like weather or sickness of workers that can disrupt workflow but typically, change orders are initiated by the client. Also, things like poorly written contracts, design errors, incomplete drawings, and poor project management are also causes of change orders as well.
From reducing operational risks to health and safety risks, there’s no way to completely avoid risks within this industry, but by being able to effectively and accurately identify the risks involved, you will be able to run your business and take on projects with the proper defense mechanisms in place.
Effective communication and good risk management are key. Just remember, great risks can also lead to great rewards.