Margins in heavy civil construction are tighter than ever. Rising material prices, labor shortages, and safety requirements all create added pressure on contractors. Decisions such as whether to self-perform or subcontract can make or break profitability, especially without real-time cost visibility.
In a recent webinar for Engineering News-Record (ENR), the panel consisted of the following HCSS product experts and construction industry professionals:
- Andrew Fowler, Senior Product Manager for HeavyJob at HCSS
- John Cappello, Senior Account Executive at HCSS
- Melissa Mott, Lead Specialist for Project Controls and Audits at Rigid Constructors
- Bill Oberlander, Senior Estimator at North Star Group Services
The discussion centered on how contractors are using software, field data, and stronger processes to overcome today’s challenges. Let’s dive into the key takeaways!
The biggest challenges in heavy civil construction
The webinar opened with a poll asking participants about their biggest challenges. The top two results were not surprising: limited skilled labor availability and escalating material and labor costs.
“We really struggle with the limited skilled labor availability,” Bill Oberlander stated. “We are in the environmental industry, environmental remediation. There are some definitive skills that we’re looking for, and we work all over the country. When we move into a new area, we try to get as much local labor as we can. However, many of the sites that we work on are remote. We’re seeing an increased cost that we’re facing just to work with that limited skilled labor availability.”
Melissa Mott, speaking from her experience at Rigid Constructors, highlighted the ongoing challenge of finding qualified management- and superintendent-level employees. She noted that recent turnover in those roles has made staffing particularly difficult. This issue becomes even more critical when trying to assign personnel to projects that were bid months or even a year earlier, as changes in labor availability and wage expectations can significantly impact project planning and costs.
Even as costs rise, contractors face the challenge of differentiating themselves in a low-bid environment. Oberlander noted that relationships and problem-solving are critical beyond just answering an RFP.
“The best way that I’ve found is to get involved with your client,” he advised. “Follow up with your client. Really dive in and figure out what they’re trying to solve and provide unique solutions.”
In other words, long-term trust and creative problem-solving can help firms move beyond being treated as a commodity.
Data as the financial blueprint
Accurate estimating and job costing form the financial backbone of construction projects. Oberlander described the importance of historical production data. “I look at estimating and job costing as a big circle,” he said. “One feeds the other, and then more accurate and historical data goes back and rolls into estimating. The better the estimate, the better the job costing blueprint.”
Oberlander also emphasized that both man-hours and dollars are vital lenses, observing that production rate costing is timeless. “It doesn’t matter if materials have increased, equipment rates have increased, labor rates have increased. If you can do so many units per hour, that’s a standard.”
On the project controls side, Melissa Mott highlighted the value of strict auditing to ensure clean field data. “We are actually strongly pushing and auditing the information that our field guys are putting in,” she said, noting how they run and look at reports and time cards every day. Her goal is for upper-level management, including project managers and even the president of the company, to be able to quickly review a daily digest and immediately understand the progress made on-site each day.
Her approach includes requiring explanations for zero production entries and building transparency through tagging. “We want to make sure that everything being put in can be looked at without picking up the phone and having a phone call,” she adds.
Building accountability in the field
A recurring theme in the webinar was giving field crews the tools they need for success. As noted, this changes organizations for the better by creating results, because nothing happens in construction without field workers.
Mott shared how ownership has flipped the accountability model: “Historically, the company hasn’t pushed that ownership down to a lower level. Because they’ve gotten that tool, now they have jumped on board and hold themselves accountable. When you give someone that ownership, they run with it.”
Even seasoned industry veterans who willingly joke about themselves being “the old guys” are beginning to adopt new technology. Some who previously relied on paper time sheets as recently as a few months ago are now actively using digital tools and adapting to modern software systems.
How often should you review job cost data?
Another poll asked attendees how frequently they review job cost data. The majority answered weekly, followed by monthly, with a growing minority doing so daily.
Mott emphasized the advantages of a multi-layered reporting cadence. Monthly reviews drawn from a company’s ERP system offer a comprehensive look at performance. Yet weekly check-ins, supported by data from HeavyJob, serve a different purpose, which is to provide timely, actionable information that allows for immediate adjustments on active projects.
She pointed out that this frequent monitoring helps avoid the pitfalls of delayed problem detection. Identifying issues within a week, rather than months later, enables the team to intervene early, make course corrections, and prevent small setbacks from becoming major setbacks.
Should you subcontract or self-perform?
One major topic of discussion was how to decide between subcontracting work and using in-house crews. Labor capacity remains a top consideration. Oberlander pointed out that it really comes down to whether the internal team can deliver a product equal in quality to what a subcontractor would provide.
“When you pay a little bit extra for a subcontractor, almost all the time it’s well worth it because you are alleviating the risk on your own company,” he commented. “You’re also alleviating the risk on the owner.”
Mott added that job costing doesn’t always tell the full story. Her instinct is to default to the cheapest option, but that approach requires a reality check. Project managers need to be reminded to ask not just “Can we save?” but “Can we realistically do it?”
The takeaway: run parallel estimates for self-performing and subcontracting options. Carefully weigh risk and labor availability, and give project managers the flexibility to make decisions based on the full scope of the project.
From insight to action
The webinar made clear that while rising costs and labor shortages are daunting, contractors are adapting with new processes and mindsets. From daily job costing and field ownership to parallel subcontracting estimates and AI-powered tools like HCSS Copilot, today’s leaders are using data and technology to mitigate risk and complete even the toughest jobs on time and on budget.
Be sure to watch or listen to the entire webinar. If you would like to see how HCSS software can start enhancing your operations, don’t hesitate to request a custom demo from one of our product experts.
