George Brown College study

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 Construction industry attitude more innovative than other sectors

By Anja Karadeglija

Special to GTA Construction Report

Construction has a more innovative attitude compared to other sectors of the economy, according to the results of a study of GTA employers by George Brown College.

The study polled more than 300 employers in the GTA area in order to find out their attitude towards innovation.

“Construction is one of those things that you could say on the one hand doesn’t really change. You’re just building stuff,” said Robert Luke, head of innovation and research at the college. “But new building practices, new building materials, new building codes, these come online all the time, and as a result, you have an industry that’s probably more predisposed to positive change.”

Luke said the study defined innovation as the process of creating value, either social or economic. It’s not the same thing as invention, he said.

“It could be new to the world, which is more like invention, but more importantly, it’s new to a market. So it’s taking something that maybe has worked somewhere else and it’s implementing it in a market, maybe a different market vertical or a different market geography,” he said.

The study asked employers what their definition of innovation was, but only about 60 per cent felt they had a good understanding of what the term means, Luke pointed out.

“In some respects, (that) doesn’t tell us anything we don’t know. We know that Canada has a very poor record of innovation,” he said. It’s a word that gets bandied about a lot, but it’s important to convince companies the concept is about getting products to market and creating jobs and wealth, Luke added.

One striking finding was that half of all employers said that innovation was the responsibility of the government, though in construction only 39 per cent felt that way.

“The construction industry is actually a little bit more innovative than the average, you could say, which is a positive thing,” he said.

Luke said the fact that half of employers said innovation was a government responsibility was “shocking” – while government should be a customer for innovation, businesses must embrace the concept in order to achieve genuine change in innovation and productivity.

In the construction and high tech sectors, innovation was more important than other kinds of skills, though productivity was still more important than anything else. Those two sectors were also “the strongest believers in the connection between innovation and gains in productivity,” Luke noted.

“They really see that creating new products and services, for instance, are directly relative to gains in productivity,” Luke said, adding that was important because it meant those companies would be more likely to invest in R&D partnerships, skills training, and new technology.

Construction, along with high tech, was also more likely to consider innovation as creating something new, as opposed to sectors that defined it as simply keeping up with the newest technology.

Innovation is crucial to the economy because resource-extraction economies like Canada’s can’t compete just based on lower prices, said Luke.

“When you’re a resource extraction economy, basically you’re going to sell yourself on the open market for the price you can get, you’re going to take whatever price you can get,” he said. “But if you are adding value to the raw resources of your economy, then you’re a price-setter. You’re value-adding to products and services and saying ‘no, I’m going to set my price high.’ And that process of being either a price-taker or a price-setter is innovation.”

Adding value in that way is crucial to increasing productivity, he said.

The construction industry is moving from being a commodity-based industry to a values-based industry. Take LEED as an example; whereas in a commodity-based industry, the focus would just be on building as cheaply as possible, in a values-based industry, the environmental footprint of the building is important, Luke explained.

“We talk all the time in this country about the knowledge economy… well, the simple fact is that the skilled trades literally built the knowledge economy. We need to do more in this country to first of all, encourage more people to enter the skilled trades, but also to help people in the skilled trades complete apprenticeships, but also to innovate,” he added.

By the nature of the industry, jobs created in the construction industry stay in the country, but products and services created through innovation can be exported, he said.

“It’s a win-win situation for us in terms of job and wealth creation here and wealth creation by selling products and services to overseas markets.”


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