Emerging Technologies in Construction: Risks and Implications

By: Greg Perruzzi

Dec 18, 2024 — The use of drones, artificial intelligence (AI), and automation is reshaping the construction industry, offering enhanced efficiency and project management. However, with these advancements come new risks. Below is an overview of these risks, some relevant solutions, and best practices for minimizing liabilities.

Drones

Unmanned aerial vehicles (UAVs) — drones — have become indispensable for inspecting, surveying, and monitoring sites in the construction industry. Their usage has significantly helped reduce the estimated $160 billion in annual waste on construction sites. For instance, drones provide real-time stockpile measurements of building materials, improving measurement accuracy by 61%.

Moreover, there's growing optimism that drones can help reduce construction worker injuries and fatalities. In the U.S., the construction industry, despite representing only 6% of the labor force, accounts for 20% of workplace deaths. With drones, construction companies can conduct surveys and inspections without endangering workers, which would lead to a 55% increase in safety standards.

A 2018 study by DroneDeploy, a leading drone cloud computing company, revealed that the construction sector was adopting drone technology at a faster rate than any other industry. However, while drones offer substantial benefits, they also present significant risks that could lead to expensive liability claims.

• Accidents and property damage: Drone malfunctions, such as collisions with structures or equipment, could cause property damage or even injuries. For example, a malfunctioning drone could crash into a building under construction, leading to expensive repairs or worker injuries, resulting in liability claims.
• Privacy violations: Drones capturing images or videos of individuals without consent can lead to privacy infringement claims. In states such as Alabama, strict laws protect individuals from unauthorized drone surveillance. Thus, construction companies could face lawsuits or reputational damage.
• Federal Aviation Administration (FAA) certification: In the U.S., any commercial use of drones, including in construction, requires compliance with FAA regulations. Operators must obtain FAA Part 107 certification, which includes passing a knowledge test that covers topics such as airspace regulations, weather, and safety protocols. This certification is mandatory for legal commercial drone operations and reduces risks by ensuring that drone pilots are knowledgeable and trained.
  
  Construction companies must ensure that their drone operators are FAA-certified and adhere to all federal and local drone operation guidelines. Noncompliance could result in fines, operational delays, or even further liability in the event of an accident.

Artificial Intelligence

The AI market in the construction sector was valued at $2.5 billion in 2022, with an expected compound annual growth rate (CAGR) of 20% from 2024 to 2032. AI and machine learning are helping address key industry challenges such as labor shortages, project delays, and cost overruns. By optimizing project scheduling, resource allocation, and risk management, AI is driving greater efficiency and improving decision-making.

The most significant applications of AI in construction thus far have been in safety, where AI can provide real-time safety monitoring. For example, drones and other cameras can provide a constant video stream of the site. The AI can then be trained to examine these images for specific hazards, such as openings that aren't properly barricaded or active safety violations such as workers who aren't tied off. If the AI detects an issue, it can send an alert to supervisors so they can address the issue. (Doyon 2024)

AI is used in construction for project planning, safety analytics, and automated decision-making, but risks are associated with AI misjudgments and errors:

• AI decision-making errors: AI systems may provide flawed data predictions, leading to construction delays or safety hazards. For instance, an AI program misinterpreting data from a construction site could lead to faulty decisions, such as incorrect structural assessments or hazardous working conditions.
• Data breaches: AI systems rely on large amounts of data, which increases the risk of cyberattacks and data breaches. Construction companies that use AI tools may face significant liability if sensitive project or client data is compromised.

AI-powered safety monitoring systems are also being used to detect hazards in real time, reducing the number of workplace injuries. From 2011 to 2019, nonfatal injuries in construction increased by 8%, with 365 workers dying from falls in 2020 alone; the growing use of wearables and other tech-enabled safety gear is aimed at reversing this trend.

Automation Risks in Construction

Automation in the construction industry offers numerous benefits, including increased efficiency, reduced labor costs, and enhanced precision. However, it also introduces several risks that need to be carefully managed. The integration of advanced technologies can expose construction projects to cybersecurity threats, where malicious attacks could disrupt operations or compromise sensitive data. There's also the risk of equipment malfunction or failure, which can lead to project delays, increased costs, and on-site safety hazards.

To mitigate these risks, it's crucial for construction companies to implement comprehensive risk management strategies, such as regular system audits, employee training programs, and robust cybersecurity measures. By addressing these challenges proactively, the construction industry can harness the benefits of automation while minimizing potential downsides.

In conclusion, while the adoption of drones, AI, and automation in construction enhances efficiency, it also introduces new risks. Effective risk mitigation is crucial to manage liabilities such as drone malfunctions, privacy violations, AI errors, and cybersecurity threats. By addressing challenges proactively, the construction industry can benefit from technological advancements while safeguarding operations and financial stability.

To learn more about Gallagher Bassett's partnered approach for the construction industry, visit our construction industry solutions page.