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Specialty Contractors Push for Growth Amid Cost and Labor Issues
Real estate construction requires a developer and general contractor. It also requires specialty trades—think plumbers, electricians and HVAC technician—to get the job done. As important as the specialty trades are, they are often unheard from.
Until now.
ServiceTitan, a trades software platform, joined forces with Thrive Analytics to survey over 1,000 specialty trades on their goals and challenges for 2025. While 93% indicated they were dedicating time to winning new projects, 64% acknowledged that 64% of respondents anticipate an increase in material costs, meaning more difficulty in forecasting job costs and protecting margins.
Other details from the survey included the following.
The Role of Efficiency
The report cited an increasing awareness that revenue growth doesn’t always mean profitable growth. Along with an increase in materials prices:
- 63% of survey respondents suggest that rising labor and overhead costs are among the top challenges cutting into profits
- 57% are prioritizing cash flow management to help projects remain financially stable
- 43% indicated that diversified service offerings are a strategy
Labor Shortage Strategies
Survey respondents also expressed concerns about the lack of skilled workers. The report said that 76% are actively hiring. Furthermore, respondents said they plan to adjust to the situation by:
- Raising wages (55%)
- Relying on communication tools (80%)
- Using project management software to improve efficiency (51%)
Technological Investments
The respondents indicated that technology can help with labor shortages, rising costs and cash-flow issues. Specifically:
- 40% of respondents are using specialized workforce management software
- 30% want to invest in new technology
- 17% said that AI is having a positive impact on their business
- 49% continue using spreadsheets, generating an opportunity for tech adoption
“The commercial sector is in the midst of a perfect storm with a fluctuating economy, regulatory changes, and rising costs,” said Alex Kablanian, ServiceTitan’s vice president and general manager of commercial & construction markets, in a statement. “In this challenging landscape, adopting innovative technology, including artificial intelligence, is essential for streamlining operations and driving profitable growth even in uncertain times. Historically, we’ve seen the best operators use periods like this as a catalyst to harden their business and build long-term durability, and it’s our job to help our customers make that happen.”
- ◦Development
- ◦Economy
