The Impacts of Covid-19 on the Construction Business Operation and Strategies to Overcome
Nur Liyana Mohamad Shahril1, Musmuliadi Kamaruding1*
1School of Civil Engineering, College of Engineering, Universiti Teknologi MARA, 40450, Shah Alam, Selangor, Malaysia
*Corresponding Author: [email protected] Accepted: 15 July 2022 | Published: 1 August 2022
DOI:https://doi.org/10.55057/ajrbm.2022.4.2.14
__________________________________________________________________________________________
Abstract: Covid-19 which has hit the whole country has caused business operations in most industries have been disrupted including the construction industry. Accordingly, this study was conducted to identify the impacts of Covid-19 on construction business operations and to identify the strategies that have been taken to overcome the impact of Covid-19 to ensure construction business operations can continue. To achieve these objectives, this study uses a qualitative approach through the traditional literature review. As a result, this study found several impacts of Covid-19 on construction business operations. Among them are project delay, psychologically affected among workers, financial problems, project cancelled, reduced labour, and resource availability issues. To overcome the impacts that arise, among the strategies taken are such as implementing effective communication, emphasizing health and safety, and enhancing the use of technology. In conclusion, Covid-19 is indeed having an impact on the construction business journey. Effective strategies such as effective communication among the stakeholders and the use of technology are necessary to ensure that the construction business operation is always smooth.
Keywords: Impact, Strategies, Construction Business Operation, Covid-19
___________________________________________________________________________
1. Introduction
The increased frequency of infectious pneumonia epidemics reported in Wuhan, China, in December 2019 surprised the whole world. With an estimated 11 million residents, Wuhan is the biggest metropolis in central China. Most of the early cases of novel coronavirus-infected pneumonia (NCIP) were reportedly related to the Huanan Seafood Wholesale Market, which was discovered by the neighborhood hospitals (Q. et al., 2020). The outbreak was thought to have originated from the market that also sells exotic animals, but it has now spread from person to person through intimate connections who have been exposed to the virus. The World Health Organization (WHO) declared COVID-19 a pandemic and warned the whole world due to the pneumonia outbreak's fatality and rapid expansion to over 180 nations. The virus has spread to Malaysia, which reported its first case on January 24, 2020 (Aziz et al., 2020).
During the early days of the pandemic, not all Malaysians were aware of how deadly this virus is due to very little information being given on the virus and how to handle it as it was still under research. On January 25, 2020, the prime minister of Malaysia at that time Tun Dr.
Mahathir bin Mohamad said that there were no plans to block travelers from China. However, he advised everyone to be careful and wear a mask as it is a dangerous and infectious virus
(The Star, 2020). Unfortunately, the number of positive cases in Malaysia keeps increasing, especially in Selangor (FMT Reporters, 2021). Consequently, the Ministry of Health (MoH), as well as the government, have taken proactive steps in reducing the spread of the virus which were the enforcement of health screening at all points of entry, increasing the number of hospitals that could treat the patients with the virus, raise fund for the Covid-19 patients affected and most importantly is Movement Control Order (MCO) was implemented. MCO has restricted Malaysian citizens to move in and out. This MCO method has been proven by China that through social distancing and isolating infected patients they were able to control the virus (Shah et al., 2020).
The medical industry, which provides gloves, Personal Protective Equipment (PPE) that may support the frontline, as well as needs like food, was permitted to function in a restricted time due to the MCO being imposed over all of Malaysia. Because of this epidemic, many individuals have lost their employment both in Malaysia and throughout the world. As a result, organizations and companies choose a home-based approach. However, it is difficult, particularly for the construction business, because most personnel must complete their jobs on- site and are unable to work remotely. As a result, a lot of workers in the construction sector lose their employment because small businesses are unable to pay their wages (Gamil &
Alhagar, 2020).
The epidemic has had a significant impact on Malaysia's building sector. On September 22, 2020, Malaysia's works minister Fadhilah Yusof said that the country's lockdown to stop the coronavirus's spread had cost the economy of the country RM 18.5 billion in losses over the first three phases. He continued by saying that there were three key causes for this: budgetary constraints, project delays, and staff shortages. Additionally, the Construction Industry Development Board (CIDB) reported that 1.96 percent of the 7590 construction sites it inspected were still not in operation (The Straits Times, 2020). Due to the high prevalence of Covid-19 and the difficulties they have in managing both the company's safety and production amid the delicate economic situation, many construction industry enterprises are impacted by economic difficulties. In order to limit the number of Covid-19 cases in the regions covered by the enhanced movement control order (EMCO), Senior Minister Datuk Seri Fadillah Yusof stated that all building and associated activity must cease in certain locations (The Star, 2021b).
Therefore, the objectives of this study are to identify the impact of Covid-19 on construction business operations and to explore the strategies for overcoming the impacts of Covid-19 in the construction business company operation. The identification and exploration are based on the traditional literature review through the existing document such as journal articles, websites, books, and newspapers. Through this method, the most relevant documents will be selected to achieve the objectives that have been set as mentioned by Li and Wang (2018). The researchers mentioned that coverage for traditional literature review is selective which is most relevant and representative and no selection criteria.
2. The Impact of Covid-19 on the Construction Business Company Operation
Based on the traditional literature review that has been conducted, there are several impacts of Covid-19 found on the construction business company operation. Among them are project delay, reduced labour, psychological affected, resource availability, financial problem, and project cancelled. The summary is shown in Figure 1.
Figure 1: The Impact of Covid-19 on the Construction Business Company Operation
2.1 Project Delay
The length of time it takes to finish a project has changed since MCO was implemented. Project time management is crucial since it determines how successful a project will be. Before delivering a project to a customer, everyone in the construction sector hopes that it will be finished on schedule, within budget, and with high quality. However, as Covid-19 approached, several projects were delayed and didn't meet the deadline for submission. Projects had to be delayed because of difficulties in the material supply since many manufacturers and suppliers had to stop doing business, and because it was difficult to move across the state and area. As a result, it was challenging for the contractors to reschedule the project's timeline while still striving to please the clients (Esa et al., 2020). To determine the effect of Covid-19 on Kuwait's building industry, a survey was conducted there, involving 205 construction sectors, including engineers and architects. Kuwait is a nation in Western Asia. According to the people who responded to the survey, it was determined that delays are one of the variables. Delays may be classified into numerous categories, including significant delays, concurrent delays, independent delays, non-excusable delays, and excused delays. The project's delay was mostly caused by the reduction in the daily work hours (Zamani et al., 2021).
2.2 Reduced Labour
Defense Minister Dato Seri Ismail Sabri Yaakob stated that Malaysia's borders will remain closed to foreigners until the number of Covid 19 cases dropped on August 27, 2020. This is a result of a surge in imported cases of Covid 19 in the nation. Additionally, a number of companies that hire foreign employees experienced a labour shortage (The Star, 2020b). The majority of the employees on Malaysian building sites are foreigners. The lack of personnel to finish the project when the Covid 19 hit the nation caused complications for several companies.
Due to the shutting of international borders because of the epidemic, most of the foreign employees were unable to enter Malaysia, hence the contractors are unable to hire new foreign workers. In addition, many foreign employees chose to return to their home countries because
The Impact of Covid-19 on the
Construction Business Company Operation
Project Delay
Reduced Labour
Psychology Affected
Resource Availability
Issues Project
Cancelled Financial Problem
of the epidemic, which contributed to the scarcity of labour. As a result, the project's performance will be affected by the fewer personnel and its delayed completion date (Zamani et al., 2021). Illegal immigrant labourers, particularly those who work on construction sites, are unable to do their jobs because they are afraid of immigration sweeps. One of the clusters that contribute to the rise in instances in Kuala Lumpur and Selangor is the building site. On June 12, 2020, 1413 instances involving migrant workers were noted. The government had decreed that only the necessary industries may function during the MCO. Many of the employees were not allowed to work (Wahab, 2020).
2.3 Resource Availability Issues
As Covid-19 cases in Malaysia continue to rise, the government has been forced to temporarily seal international borders and restrict Malaysians' ability to enter and exit the state and area until the epidemic has been contained. As a result of suppliers' businesses' activities being interrupted and some supplies being imported, building materials are delayed. They may still be able to travel across the nation after delivery work is permitted, but they must adhere to the SOP in place. The adjacent police station must get permission. Even if it is still possible, it took some time to get approval because there would be a lot of time-consuming and inconvenient documentation required for proof. the delay in material delivery (Zamani et al., 2021). Many contractors rely on supplies and machinery from China. China's output also significantly decreased as a result of the lockout. Consequently, a lack of supplies caused problems for many contractors. Had no choice but to select a more expensive material as a result. As a result, the project's budget goes up and it takes longer to complete (Majumder & Biswas, 2021).
2.4 Psychology Affected
In the construction sector, working remotely for an extended period of time is bad for the mental health of the individual. The workload has also grown as a result of the virus infecting fewer employers. Design and planning have thus been delayed. Additionally, some businesses did not have enough time to adequately schedule the new project timetable, which only made working from home more stressful for the employees. They had to put in more hours at work while resolving domestic issues that, if left unattended, may develop into serious anxiety disorders. Additionally, the management team's indifference to the worker's plight and ignorance of the new policies (Pamidimukkala & Kermanshachi, 2021). In addition, the majority of non-site workers had to finish their job at home but failed to meet deadlines due to access issues with the software, particularly for those who needed to do 3D design using AutoCAD. They might not have the programme on their computer since the technical staff installed it on the work computer before this. As a result, it caused them to operate more slowly and under more stress. Additionally, they are only able to speak online because face-to-face encounters are not possible (Pamidimukkala & Kermanshachi, 2021).
2.5 Financial Problem
During the pandemic, three main variables lead to financial issues for businesses in the construction sector. Initially, because of late payments. Contractors who were spoken to during an investigation stated that the government had delayed paying them because MCO had disrupted government operations. The government has delayed payments, which has made it difficult for contractors to pay their employees. As a result, the firm must pretend that the project is finished in order to get payment. Additionally, project costs rise. Covid 19 is a virus that may spread quickly across the community, thus it is important to test personnel frequently for it to make sure they are healthy and according to the SOP regulations. As a result, it will cost the organisation more because each screening test is pricey. In addition, fewer projects mean more competition amongst contractors as the number of projects declines. Since they
have more licences to submit simultaneous bids for tenders, higher-grade contractors would have greater benefits than smaller ones. As a result, the small contractors will receive fewer assignments and thus face financial difficulties (Zamani et al., 2021). Face masks and hand sanitizer must also be made available by the firm. They will also lose a lot of money by providing the mask because it is used frequently. Last but not least, the business must appoint a health supervisor to oversee the employees at the site and keep them informed on whether the workers follow the SOP (Esa et al., 2020).
2.6 Projects Cancelled
The construction sector has been impacted by Covid 19 because more projects were turned down than were permitted. Because there won't be any projects, there won't be any cash to support the business and, most importantly, to pay the workers, this might have an impact on the source of income for construction businesses, especially smaller ones (Zakaria & Singh, 2021). On April 22, 2020, Work Minister Datuk Seri Fadhilah Yusof stated that only 1856 construction businesses out of 19077 applicants had their applications approved by the Ministry of International Trade and Industry (MITI), with 7387 of those applications being rejected (Kalbana & Nor 2020).
3. Strategies to Overcome the Impact of Covid 19 on the Construction Business Operation
There are several strategies found based on the review regarding the strategies to overcome the impact of Covid-19 on the construction business operation as shown in Figure 2. The explanation for each strategy is as follows:
Figure 2: The Strategies to Overcome the Impact of Covid-19 on the Construction Business Operation
3.1 Effective Communication
Employers must effectively communicate with their staff, especially now that the epidemic has started. Effective communication amongst all parties is essential to achieving the goal of reducing the pandemic's consequences. The business must ensure that all employees are aware
The Strategies to Overcome the Impact of Covid-19 on the Construction Business Operation
Effective Communication
Emphasizing Safety and Health Aspect
Enhancing the use of Technology
of and can comprehend the new corporate policies that they must abide by. Additionally, since the employees need to be separated, they must be open and disclose whether any of them are close contacts or showing signs of Covid-19 (Pamidimukkala & Kermanshachi, 2021).
Additionally, effective communication is crucial between engineers, architects, contractors, and clients, particularly in projects involving the pandemic. To determine if the pandemic is covered by the unforeseen occurrence clauses for the development and defenses of claims, everyone involved must read and comprehend the contract. This is to determine which party is impacted and how to get claims (Deloitte, 2020).
3.2 Emphasizing Safety and Health Aspects
3.2.1 Thermal Scanner
Each entry must undergo a health check. Installing thermal scanners at every port of entry to identify fever in travellers from overseas was one of the Ministry of Health's first-ever measures. The foreign travellers, particularly those from Wuhan, underwent screening and were segregated severely. This also applies to the personnel working for connected airlines (Shah et al., 2020). According to the Health Ministry, 80 effective thermal scanners were available for use at international checkpoints. The government has urged the business sector to install thermal scanners at the entrances of their buildings, such as hotels and construction firms, despite the fact that each cost about RM 40000. This can help the government to detect and curb the virus faster (TheStar, 2020c).
The business that implemented this safety measure is Sunway Construction and Nestle Malaysia (Dayangku, 2020). Workers body temperature should be checked each time they enter and leave a building, according to Majumder & Biswas (2020). A new body temperature scan is required for anybody who leaves the area. Additionally, it is advised that the contractor check each employee daily for any symptoms of a cough, sneeze, or fever. The employees who are experiencing symptoms should be monitored and kept off the job (Olanrewaju et al., 2021).
3.2.2 Testing and Health Screening
All employees are required by the Ministry of Health to take their temperature before going to work. Workers who registered a fever higher than 38°C must get a health examination (Zakaria
& Singh, 2021). According to (Suhaimi, 2020), the number of Covid 19 instances involving foreign employees at construction sites in Ampang, Selangor, has significantly increased two days in succession. As a result, the government has mandated that a Covid 19 screening test be completed by all foreign workers in all fields. The expense of the testing, however, must be covered by the business.
3.2.3 Provide Mask and Sanitizer
As the virus can spread by coughing and sneezing, all personnel at the workplace or construction site must wear masks to prevent transmission. The employers must ensure that there are adequate hand sanitizers or hand soaps available for employee use. Make sure your hands are clean and sanitised (Majumder & Biswas, 2021). The greatest strategy to lessen the spread, according to (Choi & Staley, 2021), is to properly cover your face by using a mask.
In other situations, it could not be pleasant for employees to wear masks at construction sites since they must handle heavy equipment and supplies, as well as stand outside on hot and wet days. Although they might not find wearing a mask comfortable, they must nevertheless be sure to cover their mouth and nose since the infection is airborne (Olanrewaju et al., 2021).
3.3 Enhancing the use of Technologies
3.3.1 MySejahtera App
The Malaysian government developed the smartphone app MySejahtera to reduce the number of Covid 19 cases there. Before visiting locations including hospitals, malls, and even construction sites, Malaysians must use the MySejahtera applications to scan the QR code. As the infected individual must update their MySejahtera app as a person affected and they will not be permitted to visit premises, it aids the government in keeping track of the number of Covid 19 cases in Malaysia. Therefore, with this effort, the construction sector may utilize this software to monitor and manage Covid 19 if it spreads within the organization before visiting the building site or offices. The software also aids those who have the infection in receiving treatments (Government of Malaysia, 2021). The applications have been important in identifying thousands of Covid 19 instances. To track their employees' movements while at work, several businesses create tracking applications (Olanrewaju et al., 2021).
3.3.2 Drone
In order to monitor and assess building sites, the construction sector uses drone technology.
The drone may be used to follow and advance the project even in the absence of site engineers.
Therefore, fewer employees are required, which is advantageous given that the Covid-19 virus is still present in the neighborhood. Another factor that makes this product cost-effective is that workers can perform physical distance better. In addition, drones can reach any location, including those on slopes. Consequently, can save time since surveying difficult terrain requires less human strength (Zakaria & Singh, 2021). Drones should be used to monitor construction to relieve worker workload and reduce social isolation (Iqbal et al., 2021). The drone does, however, come at a high price. Not all businesses in the construction sector, especially smaller ones, can afford to purchase one (Olanrewaju et al., 2021).
3.3.3 3D Printing
Each layer is added up in 3D printing to create an item. This technique can aid in the construction of various building and bridge models (Biswas et al., 2021). The future building will make greater use of technologies like 3D printing, per (Majumder & Biswas, 2021). The use of 3D printing in construction has various benefits, one of which is the requirement for fewer low-skilled personnel. During this epidemic period, there were fewer workers. Utilizing this technology can improve project efficiency. Additionally, employing this technology helps shield workers from potentially severe risks. Additionally, can increase the number of experts in 3D design (Hossain et al., 2020).
3.3.4 Online Meeting
Due to the pandemic, internet communication is becoming the most used method. Face-to-face interactions have gradually been substituted by this to guarantee social distance, such as utilising WhatsApp to communicate more conveniently (Stiles et al., 2021). Nowadays, discussing the status of the project with the customer is typically done using online platforms like Zoom (Pamidimukkala & Kermanshachi, 2021).
3.3.5 Local Supplier
The majority of construction sector businesses are struggling with an international labour shortage. Companies have chosen to utilise a different solution to avoid future project delays.
The other option is to purchase supplies and machinery from local vendors or vendors who can deliver their goods as quickly as feasible. Because the Covid 19 virus has made delivery
materials longer and might damage a company's performance to complete the project on time, this can prevent the project from being further delayed (Alsharef et al., 2021).
4. Conclusion
According to the literature evaluation, Covid 19 has a few effects on how the building industry operates. Project delays, reduced labour, psychological effects, resource availability, money issues, and project cancellation are a few of them. The literature research also included a summary of the approaches used to mitigate the effects of COVID 19 on the operations of the construction industry, including improved use of technology, effective communication, and a focus on health and safety issues. The analysis of Covid-19's effects aids in raising awareness of how crucial it is to keep construction sites and workers' offices free of the virus in order to boost output, cut project costs, and complete projects on schedule. In addition, the study can aid in a better understanding of how Covid-19 could spread among construction workers and at the office for everyone involved in the business, particularly stakeholders, legislators, and project managers. As a result, it is possible to develop techniques that will allow employees to execute their duties in a secure setting and reduce their risk of contracting the virus.
Additionally, the findings and information from this study aid businesses in the construction sector in managing their workforces more successfully during pandemics. Finally, this research contributes knowledge to respected authorities and health officials while also serving as a reference for future scholars studying a similar subject.
References
Alsharef, A., Banerjee, S., Uddin, S. M. J., Albert, A., & Jaselskis, E. (2021). Early impacts of the COVID-19 pandemic on the United States construction industry. International Journal of Environmental Research and Public Health, 18(4), 1–21.
https://doi.org/10.3390/ijerph18041559
Aziz, N. A., Othman, J., Lugova, H., & Suleiman, A. (2020). Malaysia’s approach in handling COVID-19 onslaught: Report on the Movement Control Order (MCO) and targeted screening to reduce community infection rate and impact on public health and economy.
Journal of Infection and Public Health, 13(12), 1823–1829.
https://doi.org/10.1016/j.jiph.2020.08.007
Biswas, A., Ghosh, A., Kar, A., Mondal, T., Ghosh, B., & Bardhan, P. K. (2021). The impact of COVID-19 in the construction sector and its remedial measures. Journal of Physics:
Conference Series, 1797(1). https://doi.org/10.1088/1742-6596/1797/1/012054
Casey B. & Maani T. (2021). The world has recorded 5 million COVID-19 deaths, but the real toll is likely more than double that. Retrieved from https://www.abc.net.au/news /2021- 11-01/five-million-covid19-deaths-but-real-toll-hidden/100568156
Choi, S. D., & Staley, J. (2021). Safety and Health Implications of COVID-19 on the United States Construction Industry. Industrial and Systems Engineering Review, 9(1), 56–67.
https://doi.org/10.37266/iser.2021v9i1.pp56-67
Dayangku, S. (2020, May 15). 13 Effective Office Safety SOPs That Companies In M’sia Have Implemented During CMCO. Retrieved from Vulcan post:
https://vulcanpost.com/698941/office-covid-19-sop-safety-malaysia/
Deloitte. (2020). Covid‐19 Impacts. Africa Research Bulletin: Economic, Financial and Technical Series, 57(3), 1–2. https://doi.org/10.1111/j.1467-6346.2020.09453.x
Esa, M. B., Ibrahim, F. S. B., & Kamal, E. B. M. (2020). Covid-19 pandemic lockdown: The consequences towards project success in Malaysian construction industry. Advances in
Science, Technology and Engineering Systems, 5(5), 973–983.
https://doi.org/10.25046/aj0505119
Gamil, D. Y., & Alhagar, A. (2020). The Impact of Pandemic Crisis on the Survival of Construction Industry: A Case of COVID-19. Mediterranean Journal of Social Sciences, 11(4), 122–128.
Hossain, M. A., Zhumabekova, A., Paul, S. C., & Kim, J. R. (2020). A review of 3D printing in construction and its impact on the labor market. Sustainability (Switzerland), 12(20), 1–21. https://doi.org/10.3390/su12208492
Iqbal, M., Ahmad, N., Waqas, M., & Abrar, M. (2021). COVID-19 pandemic and construction industry: Impacts, emerging construction safety practices, and proposed crisis management framework. Brazilian Journal of Operations and Production Management, 18(2), 1–17. https://doi.org/10.14488/BJOPM.2021.034
Kalbana Perimbanayagam, N. A. (2020, April 22). 19,077 contractors applied but only 1,856 approved to operate. Retrieved from New straits times:
https://www.nst.com.my/news/nation/2020/04/586626/19077-contractors-applied-only- 1856-approved-operate
Majumder, S., & Biswas, D. (2021). COVID-19 Impacts Construction Industry: Now, then and Future. Lecture Notes on Data Engineering and Communications Technologies, 60(January), 115–125. https://doi.org/10.1007/978-981-15-9682-7_13
Government of Malaysia. (2021). Mysejahtera. Retrieved from https://mysejahtera.malaysia.gov.my/intro_en/
Olanrewaju, A., AbdulAziz, A., Preece, C. N., & Shobowale, K. (2021). Evaluation of measures to prevent the spread of COVID-19 on the construction sites. Cleaner
Engineering and Technology, 5(September), 100277.
https://doi.org/10.1016/j.clet.2021.100277
Pamidimukkala, A., & Kermanshachi, S. (2021). Impact of Covid-19 on field and office workforce in construction industry. Project Leadership and Society, 2, 100018.
https://doi.org/10.1016/j.plas.2021.100018
Shah, A. U. M., Safri, S. N. A., Thevadas, R., Noordin, N. K., Rahman, A. A., Sekawi, Z., Ideris, A., & Sultan, M. T. H. (2020). COVID-19 outbreak in Malaysia: Actions taken by the Malaysian government. International Journal of Infectious Diseases, 97, 108–116.
https://doi.org/10.1016/j.ijid.2020.05.093
Stiles, S., Golightly, D., & Ryan, B. (2021). Impact of COVID-19 on health and safety in the construction sector. Human Factors and Ergonomics In Manufacturing, 31(4), 425–437.
https://doi.org/10.1002/hfm.20882
Suhaimi, F. (2020, May 4). COVID-19: All foreign workers required to do screening. Retrieved from Astro Awani: https://www.astroawani.com/berita-malaysia/covid19-all-foreign- workers-required-do-screening-241443
The Star (2021a). Covid-19: Record high of 23,564 new cases, Selangor highest with 6,974 infections. Retrieved from https://www.thestar.com.my/news/nation/2021/08/20/covid- 19-record-high-of-23564-new-cases-recorded-selangor-highest-with-6974-infections The Star (2021b). Construction, related work in EMCO areas in Klang Valley must stop, says
Works Minister. Retrieved from https://www.thestar.com.my/news/nation/2021/07/03/
construction-related-work-in-emco-areas-in-klang-valley-must-stop-says-works- minister
The Straits Times (2020). Malaysia's construction industry records $6b losses in first three lockdown phases. Retrieved from https://www.straitstimes.com/asia/se-asia/malaysias- construction-industry-records-s6-bil-losses-in-first-three-lockdown-phases
Wahab, A. (2020). The outbreak of Covid-19 in Malaysia: Pushing migrant workers at the margin. Social Sciences & Humanities Open, 2(1), 100073.
https://doi.org/10.1016/j.ssaho.2020.100073
Zakaria, S. A. S., & Singh, A. K. M. (2021). Impacts of Covid-19 Outbreak on Civil Engineering Activities in The Malaysian Construction Industry: A Review. Jurnal Kejuruteraan, 33(3), 477–485.
Zamani, S. H., Rahman, R. A., Fauzi, M. A., & Yusof, L. M. (2021). Effect of COVID-19 on building construction projects: Impact and response mechanisms. IOP Conference Series: Earth and Environmental Science, 682(1). https://doi.org/10.1088/1755- 1315/682/1/012049
