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The Economic Update for September, 2022

Welcome to ACEC’s September economic update. Each month, the ACEC team analyzes the latest industry data and provides insights for the engineering and design industry. 
Correction: Our original podcast noted A/E industry revenues at $140 billion.  The amount has been corrected to $110 billion (9-20-22).
Here are the top 5 things you need to know:
Number 1 – The Q2 2022 total A/E revenues are in and they are at a new all-time high clocking in at nearly $110 billion. This breaks the previous record set just last quarter and marks the 8th straight quarter of consecutive growth. Engineering services led A/E firm revenue growth with a 7.3% increase between the first and second quarters of the year. Architecture services increased by 1.3% from Q1 to Q2.
 
Number 2 – The U.S. Census Bureau reports that total design and construction spending was up 8.5% in July, compared to the same time last year. Key markets that we track showed private residential spending (+14%), private non-residential (+3.1%) and public spending (+3.3%) year-over-year.
 
Number 3 – Turning to the labor market, applications for unemployment benefits fell for a fifth straight week in mid-September to the lowest level in more than three months. That news could mean the need for workers remains healthy despite an uncertain economic outlook – a sentiment we are certainly experiencing in our industry.
 
Number 4 – Inflation isn’t going away. On Tuesday, the government said inflation ticked up 0.1% from July to August and 8.3% from a year ago. As inflation continues, the Federal Reserve is set to meet next week to discuss interest rates. Experts put a nearly 80% chance of a 75-basis-point increase and a 20% chance that the fed goes for a full 100 basis point hike. All eyes will be on that meeting Sept. 20 and 21.
 
And Number 5 – On November 15, ACEC will host a private market symposium in Houston, Texas examining the energy sector. This symposium will bring together clients, economists, a/e firms, policy makers and engineering leaders for an in-depth look at the latest in the energy market. We will also cover certain funding opportunities from the bipartisan infrastructure bill and The Inflation Reduction Act. Head to acec.org for more information to join us Nov. 15th in Houston.
 
There you have it. The economic update series is one of ACEC’s private market resources for media and members.
 

Update on the Housing Market with NAHB’s Danushka Nanayakkara-Skillington

Danushka Nanayakkara-Skillington, the National Association of Home Builder's Assistant Vice President for Forecasting and Analysis joined Diana Alexander to discuss the outlook for residential real estate development now and into next year.

A Preview of the Fall 2020 Private Industry Brief

 
 
ACEC's Erin McLaughlin joined the podcast to discuss the newly released Fall 2020 special Private Industry Brief, which can be read here.  Erin will be presenting a detailed analysis of the brief during the upcoming 2020 ACEC Fall Conference later this month.  More information and registration details for the event can be found here.  

ACEC Research Institute Special: An Interview with WSP's John Porcari on America's New Playbook for Infrastructure

Engineering Influence and the ACEC Research Institute welcomed WSP's John Porcari onto the show to discuss his work with the ACEC Research Institute on the New Partnership on Infrastructure and  Accelerator for America's new report:  "A Playbook for a new Infrastructure Partnership."
 
Host:
Welcome to another edition of Engineering Influence, a podcast by the American Council of Engineering Companies. It is my pleasure to welcome John Porcari to the program. John is a senior advisor at WSP and has an impressive history, both as the Deputy Secretary of Transportation in the Obama administration, where he was second command to then Secretary Anthony Foxx. And before that, John served two terms as Maryland Secretary of Transportation. His experience in program management, planning, design, and construction delivery is widely sought after by elected officials and policy leaders across the political spectrum. And it's fair to say that his insights and advice are of great value to presidential candidates, which comes up to a sharp focus this year with the general election. Mr. Porcari is now with ACEC member from WSP, where he oversees the firm's advisory services.
Host:
And not long after the ACEC Research Institute was established, WSP suggested that one of the first projects the group could undertake was the new "Partnership for Infrastructure," which is a program that's also supported by ACEC member from HNTB. Now, the Partnership's focus was to interview mayors across the country to better understand local and urban infrastructure challenges and develop a playbook of actionable recommendations. And when the project started in early March, there was a lot of buzz about the potential for an infrastructure bill, but no one could have imagined the disruptive impact of COVID-19. And on top of that, how urban protests would make us all think more about the state of America's cities. Los Angeles-based Accelerator for America interviewed the mayors for the playbook over the course of the Spring and assembled the recommendations and led the socialization of the recommendations and various online forums. The ACEC Research Institute participated in the process as an advisor and a financial supporter, but it doesn't necessarily endorse all the recommendations, but the playbook provides a great value for, firm executives and leaders in the engineering and the A/E/C space. It provides a lot of access to gain key insights into the tough local challenges facing our cities. The mayors are looking for problem solving partners to address complex societal needs. In some cases they want consulting help before they even have projects identified. Also the complexity of project finances, much more challenging today, and simply identifying funding for a list of projects. We all know what COVID-19 and the crunch on state and municipal budgets has really done to the industry. Now, this playbook is called the community serving infrastructure, a playbook for a new infrastructure partnership, and it can be found@acceleratorforamerica.org. The link to that document as well as supporting documents will be added up to the show notes on this episode.
Host:
That was kind of a long introduction kind of setting it up here, John, but I want to give you the opportunity. Number one, thank you for coming on. And number two, you know, for us in the beltway, you are well known as an expert in public administration, infrastructure transportation for those outside of the beltway who are politically active and are engaged in the A/E/C industry. Can you tell us a little bit more about your major interests and, and in, in, in the field and, you know, the turning points in your career that kind of got you to this point?
John Porcari:
Sure. Jeff, and thanks for having me here today. I, I've been very lucky in my professional career, in both the public sector and the private sector and in the public sector, as you pointed out, sort of at the local level, the state level is the Secretary of Transportation at the federal levels, Deputy Secretary of Transportation. And now in the private sector working to help clients get these projects across the finish line which is harder and harder. And we can talk about this a little bit, some of the things that are holding it back, but what's motivated me through my whole career is infrastructure is economic development. I started my public sector career as an economic development person working on major projects. And the more time I spent on economic development, the more there was a transportation and infrastructure linkage to it.
John Porcari:
So it's kind of a natural crossover into transportation. And that's especially true at the local level. We have this great system in the U S at the federal state and local level where each level of government has various responsibilities under our Federalist system, but we sometimes forget that the real actions at the local level. So the project decisions are at the local level, the priorities are established at the local level, and then you have to work your way through what can be sometimes some very difficult federal processes and regulations, for example, to get those local priorities built. So one of the reasons that we were very interested in working with Accelerator for America and the Research Institute to actually join us in that endeavor was we wanted to take a local lens to it and hear directly from mayors of big as the city of Los Angeles. And as small as cities like South bend and Waterloo, Iowa what on the infrastructure side they would like to change and this playbook we've put together some very specific recommendations through that local lens. That'll really help all kinds of infrastructure projects.
Host:
Absolutely. That's something which, you know, echoes throughout the country. I mean, my personal experience was in Congress with former Chairman Shuster, both in the personal office and then a committee and in the personal office, in his area of Pennsylvania, it was always economic development. It was always, you cannot have growth and opportunity without infrastructure, which naturally just tied directly into roads intotransportation networks, because the two are intertwined. And, and those decisions at the local level at the County municipal level really are the things that shape what that economic development is going to look like. So having a playbook, having some kind of a document, which looks and focuses in on the needs and the requirements of mayors and of people who are really active in local government is, is critical because it's not all at the top. It's not all federal. How, how did the accelerator for America? How did, how were they chosen to do this project? Why were they kind of the, the ideal group to, to undertake this?
John Porcari:
It's a great question. We began this discussion, this journey, essentially trying to take a local view to infrastructure by talking to some of the think tanks in the Washington area, some of the larger established organizations and it was such a different kind of view for them that they had trouble getting their heads around it. And so again, together with the ACEC Research Institute we had been working with Accelerator for America on specific projects. And as opposed to a think tank, the Accelerator is known as a do tank. These are mayors like all mayors and County commissioners and County councils that are out there working these issues every day. And, you know, if it works and, you know, if it doesn't at the local level, there's no hiding it. So a believer or not no one has done this before taking this local lens to infrastructure and tried to change federal regulations and requirements and programs to fit local needs rather than the other way around, rather than the experience of mayors and County commissioners across America is you have to kind of force fit what you're trying to do at the local level into whatever federal silo is out there.
John Porcari:
So we took the opposite approach Accelerator turned out to be the perfect partner for it. And the interviews, which were part of the process with mayors across the country, Republicans, Democrats, independents - party had nothing to do with it. Infrastructure had everything to do with it. And it truly is one of the bipartisan issues out there. We heard some common themes that turned into these recommendations in the playbook. Some are very specific, and frankly, some of them are relatively easy to do and would make the infrastructure work at the local level. So much easier, so much more freedom to adapt to local conditions.
Host:
Absolutely. It's really a paradigm shift because so much of the time we're focused on federal policy and programs. And those are developed, you know, with, with some thought and input from state DOT, administrators and such, but really it's, it's never given that focus from the local area because, you know, their needs should really bubble up and shape that policy, because if you're able to solve a lot of the problems with the local level, and a lot of the things that the consulting industry engineering consulting, engineering industry can come in and help in that process as well, understanding how to apply solutions to the challenges that are facing at the local level. It can speed project delivery can improve policy. At the national level, it seems like a natural model that hasn't been followed a lot by Congress. It's an interesting thing.
John Porcari:
That's exactly right. And, and the members of ACEC, I think could be very helpful in this and the the at the local level mayors and their counterparts don't have the luxury of thinking in the silos that the federal government operates in. And as you point out, the reality is that innovation doesn't trickle down from the federal level, it bubbles up from the local level and some of the more successful infrastructure work and infrastructure policies, and even projects have been local decisions that aggregate into a national system. And if, if you think about goods movement, if you think about moving people safely and efficiently they're really thousands of local decisions that together make the national policy not the other way around. We tried to reflect that in the playbook and make sure that the mayors were heard loud and clear on what their priorities were in our, in of course it varies all over the country based on local conditions, but to a person, they, they understood the fact that it's economic development it's quality of life, of their communities, it's building the economic future.
John Porcari:
So in one example, the highway right away is not just right away to them. It's, it's how their water and wastewater systems are conveyed as storm stormwater management. It's where broadband is bringing an economic future to these communities. And so they don't think of it as the state highway departments right away. They think of it is their economic future.
Host:
Yeah. And those, those city planners, those, those you know, local planners have to look forward on, on where's the growth and opportunity going to be, where can we actually create the economic development and how can we use all of those pieces of the infrastructure puzzle together to more effectively create jobs, or attract businesses? One of the big issues that we had in central Pennsylvania was trying to get headquarters with operations and, and trying to do it in such a place where you not only had right away or, or thoroughfare, but then you also have the actual wastewater, water, infrastructure, broadband, all those different aspects. And it's, it's, it's the, at the local level, you see more of the picture than you do if you're just sitting, like you said, in those silos, and you're just looking at one or two different things now, when this started, and we didn't have any idea of what was around the bend. I mean the focus of this project must have been impacted by the pandemic. And then, you know, the social issues layered on top of that kind of two part question, the first is how did it change scope, but then, you know, how did it, how did it also expand to, put a focus on to urban areas of, and their infrastructure needs and how they may have been underserved in the past and looking at what they might need to rebuild after the pandemic?
John Porcari:
It's a great question, Jeff. And we got some great direct input from these mayors. And so is one example. We talked to dozens of mayors across the Heartland of America small and medium sized cities where they're grappling with all kinds of issues, but, but again, trying to build an economic futureit makes sure they could do it. And as we started this project, the pandemic hit so it did change the infrastructure priority to some extent, for example one of the medium sized Midwestern cities that we were working closely with found that to do online instruction for their public school district almost 40% of their students didn't have access to broadband. You can imagine what that did to the priority of broadband relative to some of the other infrastructure priorities that they have at the same timethings like some of the transit service and planning for a future transit capacity changed as well, knowing that that economic lifeline of transit, connecting people to opportunities is, is every bit as important in some of these smaller jurisdictions as it is in large areas.
John Porcari:
And it was a go-no-go item for employment in many ways. So the, the it also at the same time with some of the storm events and natural disasters that we've had in the country while we were developing this, the whole idea of resilience, which really means something in practical terms terms at the local level resiliency is being able to operate your infrastructure, making sure your roads aren't flooded out and your water and wastewater systems work. And you actually have electrical power that can survive these events is something that is, is a very practical value at the local level and something that these mayors are very focused on. So as opposed to an esoteric discussion at the national level about resiliency and climate change the practical, nuts and bolts part of it is it changes infrastructure priorities at the local level. They see the facts on the ground and they have to respond to them. In real time.
Host:
I noticed in the last Congress near the end, the T&I Committee specifically was looking at a lot of different areas related to resiliency, and the word came up a lot more. But I don't think there was a complete appreciation for what it meant. Do you think that these stories and these recommendations from mayors can help fully flesh out federal law makers understanding of the importance of resiliency and what it means? It's not a political term, it's an actual, this is something that has to be considered.
John Porcari:
Yes, Jeff that's exactly right. It is not at all a political term. It's not some esoteric discussion at the local level. It's it's the practical impact of flooding where, you know, the prudent thing to do on the redesigned side is to upsize the the culverts. It's, it's where, you know, that having buried utilities makes them much more resilient for outages and storm events. The practical impact is something that we saw very clearly and heard very clearly from the mayors where they want to make sure that they're squeezing every bit of value out of harder and tax dollars for this infrastructure by making a durable. And future-proofing it to the extent that you can. So one of the great things about applying this local lens to infrastructure is it takes the kind of sterile Washington philosophical and political discussion out of this and puts the practical impact in there where these are people across the political spectrum, working side by side, acknowledging that building more resilient infrastructure is the smart thing to do from an economics point of view. And from obviously from a service delivery point of view for your city.
Host:
Absolutely. I know that there are four broad, which kind of form the focus of the document, and that's maximizing investment for a job and small business growth, empowering localities with effective tools and processes, funding, and financing for community serving infrastructure and making transformative investments for more resilient future, going back to the resiliency part, taking kind of that last one, since we're talking about that, like you said, the impact of, of, of looking at the local level and, and saying, like you said, you know, these power lines, you know, or what have you should be placed underground, or the covert should be made larger. I mean, that definitely will have an impact on those budgetary decisions. And, and especially with the way that the States are going right now having that cash crunch related to the pandemic how do you think the document's going to come into play with that?
John Porcari:
It's a great question. So there are some very specific recommendations related to resiliency, for example, that, that helped carry the argument for these cities to, to do things differently, but it also calls for a reset at the federal level. It's the, it's the local government saying, for example, that you need to form a federal infrastructure planning council. We have all of these federal agencies that don't even talk to each other, let alone work together on a regular basis at the local level, you don't have the luxury of, of building things in silos, organizational silos, this federal infrastructure planning council would be a forcing mechanism to get the different federal agencies like the Corps of Engineers responsible for all of our inland waterways, great lakes inland maritime transportation working with other federal agencies where they very seldom interact in practical terms where they do it's at the local level where you have local representatives and a local project that forces them to work together.
John Porcari:
So the idea is at the state and federal level to, to really highlight what some of those disconnects are, and in, in a very practical way, show how we can do a better job. And again, it recognizes the reality that's that's in our constitution and in the way we operate under federalism, but is not recognized in our institutional structures, which is those decisions and choices are made at the local level. And they should be but you don't have a federal partner that's necessarily recognizing that. And the federal share of funding in many cases in percentage terms is declining every year. So you have this ironic position of more local funding going into these projects, less federal funding, but federal regulation that makes it difficult to do business.
Host:
So how would that, how would that planning council be structured? Would that be executive level, or would that be kind of a congressional action? How do, how, how how's the playbook kind of see this happening?
John Porcari:
Well, it can be done a couple of ways, what the playbook focuses on are practical solutions. So for that planning council, the deputies level that the deputy secretaries and deputy directors in the federal departments by definition are the chief operating officers. And on, on important issues, they function is a deputy's council where they actually get together and work through issues. And what, what the playbook is saying is that for infrastructure planning at the deputy secretary at the deputy director level, we really should have that kind of coordination across the executive branch. Now, as you well know, from, from, from your background, these individuals report to all different committees of jurisdiction, but that shouldn't be the local government's problem. Right?
Speaker 3:
The whole idea is, is that you have the, the executive branch agencies working with each other to make it easier for the project choices and to build those projects at the local level.
Host:
So formalize the informal working groups into an actual council that meets and discusses infrastructure and creates a liaison for the States and for local governments to bring the ideas up, to be discussed at that operational level. That's right. And give them a specific agenda on where those barriers to cooperation are, where some of the loan programs are too restrictive and can't be used. The what you tend to do at the local level is try to get as much different kinds of infrastructure into every project that you do at the federal level. It's more of kind of a rifle shot approach where you have very narrow programs. So part of the agenda for that planning council for example, would be to broaden those programs to think more holistically to, again, frankly get better value out of these public investments by making the infrastructure more holistic and more comprehensive. It sounds fairly common sense. So, so how would, how would that, for example, you know, how would these policies accelerate, you know, improvements really that the brick and mortar infrastructure and the people really care about the, you know, you have the drinking and the wastewater, of course you know, Flint was, you know, still is the poster child for that, but then, like you mentioned earlier, we have, we have broadband, we have the issue with the gas tax and we have declining revenues, but have increasing, you know, via electric vehicle market, but we don't have a national electric vehicle charging infrastructure, you know, that's something which has to be addressed. And, and the other, those transformative areas that seem to be happening at the state and local level, of course, the States that are really ahead of the curve and trying to be centers of innovation and are starting to think of transportation, not in transportation sense, but as in mobility and, and, and as a holistic way of looking at things how would these policies help accelerate that the federal level?
John Porcari:
Yeah, it would do. It would happen a couple of ways. One I mentioned, which is most infrastructure projects of any size are not funded anymore. They're financed. And that's, that's a very important difference where it may be a 50 or 70 year lifespan piece of infrastructure that has a 35 year loan against it. Broadening the eligibility of those loans would be one thing, expanding the capacity of the federal loan programs, whether it's for highway or transit, water or wastewater. If you just look at the lead pipe and lead contamination issue, the, the existing federal programs capacity for loans is only a fraction of what you would actually need. And it's not just Flint, Michigan it's cities and towns across the country and rural areas. It's also other federal policies. So electric vehicle tax credits can be expanded, accelerated depreciation, all the kind of tax policies that actually trigger private sector investment in infrastructure or public private partnerships is, is something that can be encouraged through these recommendations. And the idea was to be w was, was to try to address the infrastructure needs and be agnostic on whether it's publicly addressed or privately addressed, or a partnership between the two but across the spectrum to try to identify some of these very specific recommendations that that can actually make these things happen.
Host:
Yeah, and that's a very important point because earlier in the couple of months ago, we did a, a round table discussion on the future of funding and transportation. And we had some, some policy think tank guys. We had Jeff Davis and Eno, and we had some thought leaders from Harvard. We had kind of a mixture and everyone agreed that, you know, reliance on farebox revenues especially now. I mean, you can't do it, you can't do it. There has to be a, there's not one solution. There has to be a number of different solutions to broaden the type of financing that you can actually go for for these projects that, you know, just relying on trust, run revenue, for example, is, is something which is, which is difficult in a time of declining revenues. Is there a recommendation on the trust fund within the document?
John Porcari:
It doesn't make a specific recommendation on the trust fund. The participants in this study, like everyone else acknowledged that's that it has to be changed. The system has to be changed. There's no, there's no trust in the trust fund anymore, right? If the Congress has to keep putting general funds and other monies into the trust fund, it's actually not a trust fund where and especially with the recession related to the pandemic, we're seeing trust, run revenues declining very rapidly. But the idea would be to at the local level and the federal level to open the aperture for more innovation on the funding and financing side. And there are jurisdictions that have limitations on how they can raise local funds. These local bond issuances and referenda and local other kinds of local self-help initiatives are limited in many places yet.
John Porcari:
They're actually the primary funding source of the local funds for many of these infrastructure projects. So opening it up across the board and making a better case that infrastructure is actually an investment. Yes, it's an expenditure, but infrastructure given its lifespan and given the economic activity that generates is actually a good investment. Whether it's airports and air service highway transit, the utilities that provide services you simply can't have economic growth and the quality of life we all want without that infrastructure investment.
Host:
And, and I know there, there are a couple of ideas about state local road transfers and federal funding for betterments. Can you go a little bit more into that? You know, what problems are we solving by transferring road ownership from, from state to local governments and, and what is the focus on betterments about?
John Porcari:
Sure, let me take each of those in turn so that the road transfer part of it is a recognition that the primary purpose of any given road may change over time. So in every state, there are state routes, the numbered state routes that were probably very important from a regional point of view maybe back to the horse and buggy days. But that state route is now main street for a town or city. And in that municipality it's serving a very different local function as opposed to the regional function that was originally built for. And so who would be the best steward of that? Who would use that right away most effectively for all the things we talked about, water and wastewater, broadband, burying electric utilities transit service, maybe dedicated transit lanes inductive charging in the next few years.
John Porcari:
The idea is that some of the functions of those roads, which were much more of a state function in the past local function now, it's not true in every case. The idea is to look at those individually and see where it makes sense it might have been for that state route example, 75% interest state regional traffic before. And it may be 25% now. So who would be the best steward of that? The betterment issue is a really interesting one, the when there's a hurricane or tornado or storm event that does significant damage for example, to our highway infrastructure. There's, there are emergency relief funds from the federal government to rebuild that in this highway example and until not too long ago about eight years ago, you could only rebuild that highway the same way it was built before you could not put in bigger storm drainage culverts.
John Porcari:
You couldn't raise the elevation. The idea of betterment is now accepted and it's federally funding eligible where you could rebuild that highway. And now you can do it with transit. You can pull it out of the flood, plain, you, you can armor it in ways where you're not rebuilding the same facility time after time with federal money, emergency relief money, every time it's common sense, but it's something that literally was not allowed until fairly recently. And so one aspect of resilience is to make sure those betterments rebuilding smarter every time is built into the core of what we do.
Host:
Yeah, that's a really good point and it makes complete sense. And I know, but it's the kind of thing that, that from an, you know, from an industry perspective, when, when a firm like WSP or a firm, you know, another ACEC member firm is brought onto a project, you know, they're of course working as a trusted advisor to their client to be able to say, okay, well, this road is built this way, but what we know of, you know, past events and you know, our expertise that we bring into it is that you should be improving it in a number of ways. And here is our expert consultation on how to, how to do that. And, if that idea is, is adopted by a broader swath of the States, that it means that you're going to have an improvement overall in the length and the value of infrastructure, like you said, stretching that dollar, that taxpayer dollar further, and just rebuilding a road exactly how it was. And it's just going to be washed away or destroyed in an earthquake, or what have you again,
John Porcari:
Right. That's right.
Host:
Now we talked about fund financing. We talked about the betterment issue. I know that the plan has a few deregulatory ideas on, on project delivery and cutting red tape. They include accelerated procurements reviews, the permitting, P3 processing. I, you know, we've heard a lot of these ideas from state officials. Did it really surprise you that a lot of these priorities were also coming from mayors who were interviewed?
John Porcari:
Not really the, the more time you spend with mayors, the more you see that they really are hands on problem solvers. So the one of the specific recommendations shortening the procurement cycle is basically the the city's asking the federal government to do what they've already done. We had a mayor for example, that during the pandemic cut their procurement times by 50% and just did it they're meeting all their legal criteria. It's there's no part of the procurement process that's been compromised, but they literally shave 50% of the time off. And the idea is if you can do that at a local level, it can be done at the federal level too. And it, if you do it at the local level and you don't have a federal partner that also cuts their response time and their review time, it doesn't help because you have to get ultimately get there. Okay. Anyway, so these are commonsense forms that don't really don't compromise the quality or the integrity of the process or the project. But what, what the recommendation is really saying is we can do it at the local level. We'd like our federal partners to do the same
Host:
Now to kind of wrap it up. I know the last areas, it really kind of goes into the job creation and employment issue, which is, which is especially important now with the effects of of the pandemic on, on employment. But the playbook discusses a number of of different areas. Here are the importance of training centers of local and targeted construction hires and support for small and medium sized businesses and, and the importance of, of expanding federal research into a lot of these emerging transportation and, you know, planning and such, where do you see this going? You know, what area in this kind of gets your attention the most?
John Porcari:
Well from a local perspective, this was a really pressing issue as well. So part of it is trying to squeeze again, as much value as you can out of tax dollars, by making sure the money stays in the local economy, to the extent possible. You know, at the end of the day, these infrastructure jobs or jobs you can't export, they are American jobs. And as an industry, there's a lot we can do to maximize that. But it also it also talks about taking projects as an opportunity to move people up the skill scale. So if you are learning a skilled trade from a laborer to say high voltage, electrician or welder is part of that project. You have brought someone into the middle class and doing that. And there's a whole ecosystem that could be helpful to that.
John Porcari:
The community colleges that are operated at the local level, we'll put together a training course for anything there's demand for. And there's a little bit of a chicken and egg aspect of this, where you need to make it, if it's clear, the demand is there for skills training, as part of infrastructure construction, the training will be there through private programs to community colleges, through unions and others, lots of providers but what we have not done and, and you can't do at the local level by yourself is systematically put, put that together into a system that lifts people up that skills ladder and provides better opportunities.
Host:
And that that's, you know, cross jurisdictional, because that's not just, you know, infrastructure or transportation policy, but it's educational policy at the, at the national level. It's how, how do you, how do you make the two kind of fit together, which shows, you know, the size of the task, but also the value of these recommendations to inform especially federal policy makers. Since it's an election year, I can't not ask the question. How has this playbook been received by the candidates have you or anyone else from, from, you know, who were leading this charge brought this to either the presidential campaigns or, or any of the the leadership and at the federal level to say that if, as you're, as you're developing policies, keep this in mind.
John Porcari:
It's a great question. At the beginning of this discussion, I mentioned that this is very much a bipartisan effort by bipartisan mayors. And so the playbook recommendations have been made available across the board people on both sides of the aisle have been briefed on it. I will just tell you from my personal perspective and personal experience and full disclosure, I'm a strong supporter of vice president Biden. The uptake of these ideas and, and concepts behind it has been very positive. There's a recognition that, that again, the innovation's at the local level, the decision making's at the local level, let's make sure we're letting our local elected officials make they know what the right choices are for their jurisdictions. Let's back them up and support them with federal policies that actually help them as opposed to getting in their way.
Host:
That's a really good point. And I think a good, a good area to, to leave it on. John, do you have anything else to add about the playbook? It, we've covered a lot of ground here. We know a lot of the recommendations, but is there anything, any, any final parting thought that our listeners should know going out of it?
John Porcari:
Well, I, again, this is, this is from a local perspective and it's very practical as mayors are. So there, there's nothing in here that can't be implemented ACEC members around the country should really think about how this can help locally. To a person ,the members are working at the local level, helping with those local choices, literally use the playbook for what it's intended to be, which is a way to help you with infrastructure, construction and, and in a more general sense, help make the connection between infrastructure and economic growth and prosperity. And the fact is, you know, if we're honest with ourselves, you can look at infrastructure coast to coast here, if you're honest with yourself, and you look at that infrastructure more than likely it was built and paid for by your parents, or maybe your grandparents, and in some cases, your great grandparents. So, it is just irresponsible of us not to invest in the future. It's the best thing we can do for the country going forward in terms of thinking about the future.
Host:
Yeah, really good parting thoughts there, because I think that one of the things that our members are very busy running their firms are very busy of course, with the work that they have ahead of themselves and running an office from the time of pandemic. But we can't lose sight of the fact that, that from an industry perspective, we're the thought leaders who can help drive these decision making processes at all levels of government that as an ACEC member, as a professional engineer and a business leader, there's a platform and there's expertise that our elected officials can't get anywhere else. And if they're able to use this documentthe playbook as a way to inform their thinking and develop their own thinking it'll help raise the profile of the industry as a whole, which is of course, one of the focuses of the institutes, you know, one of the key missions is to support the growth and the thought leadership of the industry.
Host:
But, you know, from a business sense, it'll, it'll make you more competitive when you're going for business, because you can put that economic argument behind it. You can put that, you know, like non, non partisan political argument to, to tie it all together and justify a project. I guess I do want to put a plug in because the, the ACC research Institute coming up in the, in, in, in next few weeks is going to be delving into aspects of the playbook. We're going to be doing some round tables on the playbook in conjunction with Accelerator for America. And we had our first series of round tables on the future of engineering. They were very successful and we look forward to another successful series coming up in, in only a few weeks but more information on that's going to be coming up shortly.
Host:
So stay tuned. We are going to post up the the, the program on the show notes, we will have a link to the, to the Accelerator for America website. And then of course, that will have the link to the playbook. John, I really appreciate your time today. Thank you so much. And I know our listeners really benefited from hearing your views and your expertise.
John Porcari:
It's my pleasure. And I do want to thank the ACEC Research Institute, and also everyone who's involved in putting this playbook together, because it took a lot of hands to actually get a nationwide perspective here.
Host:
Well hopefully we can have you back on the show a little bit later after we have those round tables and kind of maybe after once we get a better idea of what happens in November, and we get a better idea of, you know, what infrastructure policy might look like and either administration it might be good to revisit these issues. So until then, again, John Porcari, He leads advisory services at WSP, but he is also just a very, very knowledgeable individual when it comes to federal and state and local transportation policy. And thank you so much for being on the show.
John Porcari:
My pleasure, Jeff. Thanks.
Host:
And this has been Engineering Influence a podcast from the American council of engineering companies. We'll see you next time.
 
 
 

The Impact of Technology on Engineering - an ACEC Research Institute Roundtable

On June 18, 2020, the ACEC Research Institute held the first of a series of panel discussions on the future of engineering.  The topic covered by the panelists was the "Impact of Technology on Engineering."  Panelists included:
• Jose Luis Blanco, Partner, McKinsey & Company• Mike Haley, Vice President of Research, Autodesk, Inc.• Chris Luebkeman, Director for Strategic Foresight, Office of the President, ETH Zurich• Heather Wishart-Smith, SVP Technology and Innovation, Jacobs• Moderator: Joseph Bates, ACEC Research Institute
A full video of the roundtable can be viewed here. 
Transcript:
Daphne Bryant :
Behalf of the ACEC Research Institute's, board of directors. Welcome to our first round table and the series, the future of engineering, a big thank you to our donors who have made this session possible. We have a great group of thought leaders, as you can see here today that will share their insights and expertise with us on the impact of technology on engineering without further ado. It's my pleasure to introduce two of my colleagues from the ACEC research Institute, Joe Bates, who will serve as our moderator today and Kevin McMahon, who will be monitoring the chat box and fielding your questions during the session, Joe, it's all yours.
Joseph Bates:
Thanks very much Daphne, and thank you everybody for joining today's round table. Before we get started with our questions, I'd like to introduce each of our panelists for the webinar. Today. First we have Jose Luis Blanco. He's a partner at McKinsey & Company Jose leads, McKinsey's engineering, construction, building materials and construction technology work in North America. And as a leader of its retail real estate practice, he brings deep expertise in optimizing performance and unlocking value through embedding digital capabilities and deploying and scaling up new technologies. We also have Mike Haley, vice president of research at Autodesk. Mike leads a team of researchers, engineers, and specialists to explore the future of how people design and make things. A primary focus of his team, is automation and leveraging technologies and disciplines that include machine learning, robotics, human, computer interaction, geometry, and visible visualization. Next, we have Chris Luebkeman. He's the director of strategic foresight at office of the president with ETH Zurich.
Joseph Bates:
Chris has a multidisciplinary education, including geology, civil engineering, structural engineering, entrepreneurship, and a doctorate in architecture. And he is deeply passionate about curating, constructive dialogue, insatiably curious. He relishes the opportunity to discover the opportunities which will be created by change, and perhaps most importantly, to evolve position solutions to the profound positive solutions to the profound challenges we face today. And last but not least, we have Heather Wishart-Smith. She's SVP of technology and innovation at Jacobs. Heather is a registered professional engineer and certified project management professional with proven, experience managing large design programs and developing, managing, and turning around troubled offices and the architectural engineering professional services market. And also Heather is a fellow of S A M E and she is currently the president elect for the 2020, 2021 Centennial year. Thank you all of our panelists for joining us today. I'd first like to start out with a question fairly broad one for each of you to start out with, and I'm going to ask Mike to start us with this based on your individual perspectives, as you look at the engineering industry, what are the one or two biggest impacts that technology will have on the industry in the future, say in the next five to seven years, for instance, will, will things be going faster? We'll be doing things in a different place,uwhat what's going to happen, Mike?
Mike Haley:
Thanks, Joe. Yeah, it's a, it's a, it is a broad question. There's two things, main things that come to mind for me. So the first one relates to systems and, you know, I think as we all know engineering anything in the world today and especially buildings is all about resolving the various forces that are acting between the systems and systems might be the relationship between the architecture of the building, the structure of the building NDP systems. It could be the relationship between the materials and the methods of production of the building and the sustainability of the environment. It could be the relationship between the people that are ultimately going to be in the building. And today in most practices, we don't have a way of resolving all of those tensions all the time because systems are inherently very complex and they're always changing. So the industries rely on rules of thumb, established practices, standards, these kinds of things.
Mike Haley:
And I can see that changing in the future. We're beginning to have the ability to automate the understanding of systems and be able to bring those insights and that guidance to engineers and designers in that process. So that's my one aspect that then leads to the second one, Joe, which is that with all of this automation and your question about, you know, you know, do, do we, are we going to need more engineers or are we going to need less engineers? What's the nature of the job market? I actually believe we're going to need more. And the reason I believe you're going to need more is I actually think we're opening up the world to greater possibilities right now with these tools. And that is going to lead to the next, my second point, which relates to knowledge and education. And I think as we build automation systems that understand and learn the patterns, we don't just use that knowledge to automate and make the machine do things, but we can use that knowledge to upskill people. We can train people more easily in using tools and using techniques. We can raise the sea level for lots of people at the same time with technology. So I see that as a sort of a commencement great trend that we're going to see in the coming years.
Joseph Bates:
Great. let's, let's go over to Chris. Chris, what do you think?
Chris Luebkeman:
So I, I totally agree with everything Mike just said, and I want to amplify a couple of points. I think there's three things. We're going to see expansion, acceleration and consolidation. As Mike said, an expansion of what we can do and expansion of toolsets and expansion of knowhow and expansion of what we're going to be asked to do. I think there's the acceleration, there's going to be, we're, we're suffering from this already when we like to complain about not enough time to even think anymore, we just have to do do do, and frankly, that's not going to stop. And so therefore these tools are going to help us. I hope and these techniques and our, and our teaming will help us deal with that acceleration. And the last is consolidation. I think we've seen over the past 10, 20 years, an industry wide consolidation, especially in the built environment.
Chris Luebkeman:
And I believe frankly, that will continue, but I also believe we come back to the first one, it's going to lead to an expansion because as we have the consolidation and either, so this core, core, core core, all of a sudden, there's going to be the realization. We need these new typepology, these specialists who can really focus on, for example, getting our, our third world infrastructure back up to what it needs to be in order to to regain our, our, you know, a position of pride and the other parts of this sort of this other is a consolidation of knowledge. I really think that we're going to be able to acquire and that it's not consolidation by what's there, but how we get it. Right. So we're going to be able to in a much easier way, consolidate know how consolidate knowledge in a much more rapid way. So those are my three words. Great. Jose, what about you?
Jose Luis Blanco:
Like how Chris frame it in three specific like you know, sentences or, or, or, or things? Let me try to do the same. I think that for me, the three things that I believe what I would love to see going forward, given what we see in technology is more transparency first. Second, being more output outcome driven. And the third one is actually much more collaborative environment. Let me try to just give you 15 seconds for me to one the transparency of think it's clear, but I think it's, I think right now we're capturing data. Not only we capturing data, we're storing data in a much more way that is going to be, we're going to be able to actually analyze that data and provide like, you know, transparencies and some traditional issues we always have a, in the construction industry and Jane construction English, okay.
Jose Luis Blanco:
Who made that change? What happened? What was the implication? So I think that that's going to be a huge unlock for us, and we wouldn't have a lot of noise that is always around our industry and to move forward. The second one is outcome driven. It's also tied to the first one. I think if we have more data, we have more transparency and then we're going to be able to actually you know, our designs are going to be much more outcome driven is going to be able to provide better service to our owners. I mean, I'm sure Mike and his team are working on Gera design, like crazy these days. And that for me is critical because it's going to be able to fully actually capture what the client needs and actually tell them, like, here are the choices for you, depending on the outcomes you're trying to achieve.
Jose Luis Blanco:
And the third one, which is the collaborative point, I think is much more than just breaking silos because we're going to have much more transparency. It's like for me, going back to Chris' point about knowledge, is really unleashing like the potential talent of fully the potential of like a group of engineers working together, right. Removing all the constraints that we need to do right now being tying like the King of silos and many other things. So these three things : transparency, outcome driven and collaborations is the things I expect and hope to see in the future there.
Joseph Bates:
Heather why don't you round us out here with your thoughts on this subject.
Heather Wishart-Smith:
Sure, so I think that my thoughts on this are really quite frankly, complimentary to what the gentlemen have mentioned. The first really that I would focus on is the interconnectivity of systems. So I've mentioned since, but that interconnectivity and disciplines, and then also the technical workforce. With regard to the interconnectivity of systems, you look at the interconnectivity of society we're coming out of the pandemic, the future of cities the urbanization, everything is going to need to rely on techno technology to really meet that exponential growth and the exponential growth of mega cities. So as was mentioned earlier, this will provide more opportunities for engineers to get involved, to leverage that kind of technology. And, you know, Jose mentioned silos. With that, I mean, I really think that those who are most successful in the technology enabled world will be those who are able to break down those silos and cut across disciplines.
Heather Wishart-Smith:
So much of what we do in innovation is rather than just say creating something in one discipline and then kind of throwing it over the transom for the next discipline and the next discipline; cutting across, and co-creating across disciplines in order to increase that speed to market. But then the workforce is that second aspect. You know, of course there's so many statistics out there about the U.S. In particular, not graduating enough STEM graduates, and of course it's about more than just graduating them. We need to retain them once they come into the workforce in order to remain competitive. But we also need to recognize the value of the trades, particularly as the trades become increasingly complex, as we bring IOT into operations and maintenance and all of that. So I think sometimes it's tempting to view technology as kind of a way out of not graduating enough STEM graduates, but it's, it's, it's really going to cause the need for even more of those graduates.
Heather Wishart-Smith:
They need to, you know, they need to have the skillset to design a program that operates and maintain all the technologies that we think will help, you know, get us out of, out of the, the brain drain if you will. But that, that workforce, it needs to be nimble, adaptable needs to be committed to lifelong learning. And finally, I think it's critically important that that workforce be inclusive and diverse. It's not just the right thing to do. It's been proven by study after study that inclusive and diverse companies and organizations perform better. It allows us as an industry to just really cast the widest net to draw the widest possible pool of candidates, to get as many STEM professionals as we can. And it's really once you that critical mass of diversity, that's when you can get the most benefit from diversity of thought.
Joseph Bates:
So, Heather, I think you've provided a great segue into the next section of questions here that I wanted to ask about. And that's about the increasing speed of design and how that impacts projects and delivery. And in particular, are there generational issues that we need to consider here are our younger people that are graduating more adept with the technology that is out there, or, you know, what, what are your thoughts on this?
Heather Wishart-Smith:
So because the people who are graduating today are digital natives. I think it's, you know, very often tempting to fall into that unconscious bias that people who are have more time in their career might not be as willing or able to change. But I have found and worked with so many people who were at the latter end of their career, who really do fully embrace that technology and innovation. So I mentioned earlier being nimble, being adaptable, having that commitment to lifelong learning, it's really about that mindset. And I think it's also important to be open, to taking on say a reverse mentor. Yes, we absolutely need to be learning from, from younger people. We need to provide better pathways to promotion and success. We, we shouldn't in any way be writing off due to our unconscious bias, any kind of you know, whole groups of people, right.
Heather Wishart-Smith:
I, I'd also add that, you know, not all technologies innovation, not all innovation involves technology. Some of the best innovations we have are those that have nothing to do with technology. It's really innovation in my mind is about how you approach problem solving, constantly asking what is the problem that we're trying to solve. So automation, of course, you know, we all know it should be harnessed to reduce repetitive tasks. And oftentimes also more higher risk operations to get people out of harm's way we should be using it for rapid auctioneering. We all know about, you know, generating just infinite possibilities, filtering them down to make sure that we're presenting to our clients what's best for them. Gone are the days where we show up at the [inaudible] with just, you know, possibilities. So we have a lot more to offer it's design attitude approach rather than the decision attitude approach, because you know, of course, decision attitude is assuming that all the, you know, the good options are out there. It's just a matter of deciding which one is best, but as we move into more automation, I really think it's important to take the design attitude approach to come up with the best alternatives. And then after that, the decision will be much easier.
Mike Haley:
Yeah. I'll answer that a little bit. What had I say that, you know, what, what we've found with the, with the newer generations, the digital natives, as you put it, Heather, is that there's a different expectation about the time to productivity you know, the traditional tools, certainly that we've been building were things that required a long time to become proficient. You had to study them, you had to learn them, you to learn the features you had to, there was a period of learning that was required. And there's, there's a level of expectation now about digital natives that they can pick up a tool and be productive immediately. So there's this relationship between learning and being productive, I think, is going to change. It is we're not ever going to have a world where you learn first and after I think, period, the time you become productive, the two are going to be much more intertwined.
Kevin McMahon:
I've got a question from the audience, one of the audience members wants to know in the future because of the varied nature and multidisciplinary skills that are going to be needed, that all the panels have mentioned, will, graduates be coming out of school with a more varied skillset - majors in civil, but perhaps minors in mechanical and electrical, for instance.
Heather Wishart-Smith:
Yeah. So I'll address that. I would even great question and I would even take it one step further, not just minors in mechanical and electrical, but in programming, in robotics, in all kinds of different disciplines that might not have been considered as related say to civil engineering as in the past. But the challenge for us in the industry is to make use of them. I think the risk is really there where you get the bright eyed, bushy tail, new graduates, and they come in and you're really attracted to them because they have the programming skills, they have the robotics background, they've done all kinds of three D printing. And then we sit them behind a computer and tell them to design things the same way that we've been doing it for decades. And we run the risk of burning them out of just really disenfranchising them. So we can't just be attracted to them. We need to recognize that we need to continue to foster that and cycle them through different opportunities and then listen to them when they come up with a way to challenge the status quo.
Jose Luis Blanco:
I think what Heather just said is super important. And I think that there's, if I may add one, another point is I think there's a very thin balance between and technology needs to help us with that between actually ensuring the that we maintain the knowhow that has been billed by the, I will call the older generation so to speak. I mean, we know that 30 or 40% of the workforce is going to retire over the next 10 to 15 years. So I think technology needs to allows us to capture that kind of knowhow making institutional and at the same time, without the same time, you know, and now we're allowing or empowering the new generation to do new things and doing them right. Right. So for me, that's a little bit of like [inaudible] out the new generation to do things differently, not the same way I've been down before that, for me, it's like what you actually make magic happen.
Chris Luebkeman:
So excuse me, I'd like to build on that as well. Yes. And first to the graduates, and then to what Jose was just saying, I think the question Kevin was a little bit in my mind too limited. Saying gonna major in civil and mechanical, I would much rather say, well, how about civil and philosophy or civil and biomedical or bio or, or, or some earth sciences or something that's actually, I think what we're hoping to see is actually a mix of the hard - the decision sciences with the natural sciences, because the challenges which we require, I think as a society are not just those who are trained how to make a decision, but as Heather was saying, the profound impact of a systems understanding and the need for us to understand more and more about how the elements within their systems sometimes need to be sub-optimized so that the system is optimized. And I think this is one thing. And the second point to build on what Jose was saying is I, totally agree with that. And we have to figure out how to make real lifelong learning, not just continuing education credits, which you go to some lunchtime lecture, which we all do and get a stamp and say, Oh boy, that was good. Thank you very much. But actually to real meaningful, lifelong learning and how I, and I, frankly, I don't know exactly what that means at this point, but I do know we're all recognizing that due to the, due to the rate of change, both professional, informational knowledge, that we need to find better ways to foster, to empower and encourage real lifelong learning and lifelong curiosity to learn. And I think that those are the two aspects there, which are not hand in hand, but in North self evident, but very, very critical for us.
Kevin McMahon:
Joe, we have one very interesting question then I'll let you ask the next question to the panelists. The question is with the super evolvement of technology to the panel is see that where most of the work is still procured locally and performed locally. Do they see a future where the local office, where the client is maybe just a small nub or collaboration, and then the bulk overwhelming bulk of the work is done around the globe or, or outside that core local office. Do they see that future happening in the next five to seven years?
Mike Haley:
I will. I'll say we're, we're beginning to see that happening already. I don't think it's a, I think it's, it's a growing trend. You know, technology is enabled and enabler of it. So as the economy, so it's society, right? All at the same time, we're seeing the shift of cloud adoption. People storing the data in centralized locations that can access it from everywhere. The days of having it on the server, inside your company, and only being able to use it. They're pretty long gone for a lot of companies. I think the gig economy, the notion of being able to hold down multiple contract jobs at the same time, switch between things, manage your workload, manage your life is a reality for a larger, larger number of people year over year. And then I, I just think that the borders are breaking down in terms of how we think about the world. And I think just because you live in another side of the world, you can think about problems elsewhere in the world, quite easily. You have access to that information.
Heather Wishart-Smith:
And I'll add to that. We've actually been doing this for years. It started out, I looked back in my career when I was, you know, managing programs. It started to become of course necessary when you needed to bring in a specialist who you wouldn't expect to have in the local office, but it really has evolved to the point where it's just a normal part of how we do things these days. And I think it will just continue to evolve. And that's a little bit different. I come from a very large firm,uand the smaller firms probably it's not as necessary, but it it's absolutely being done. And in addition to the technology and adoption of cloud, as Mike said, also,uvirtual and augmented reality has helped to facilitate that as well. And it also means,uless travel for some of our staff. So that's better from a work life balance perspective.
Chris Luebkeman:
To me, I agree with both, both of those, again, strange, but to me it's all about access. Now, at the end of the day, you used to not have access to first-class knowledge unless you were in a center. Now we right now are in two different continents at seven different time zones, and yet we're all accessing each other at this moment and the other, almost 300 people. And so it's it's access. And so it's access to knowledge, but it's also access to the marketplace. So I've been for the past five, 10 years, really, really encouraging the integration of small local offices, because at the end of the day, we know with the global move towards segregation. So national segregation and regional segregation, this is, this is going to continue. And so the local offices are going to become key to be networked and to create a new kind of network, which is trans-regional as, as the, you know, globalization screeches to a halt. I think this is, this is going to be a new reality, which we have to really look at. How can we make sure that the small local office can really provide the most excellent world-class delivery. And I, and I think that at the same time, we will still be, the big firms will still work globally and the Jacobs, the ARUPS, and all these they'll be able to flip work around the, around the world and continue doing that.
Joseph Bates:
Great. So I want to move on to the next section and I'm going to have Jose - I'd like to direct you then to start out with you on this one. There's a lot of buzzwords today in technology such as digital twins, data analytics, machine learning, and artificial intelligence. I'd like to talk about, first of all, what are the terms actually mean? And secondly, how will they actually affect the industry in the future? So maybe Jose, if you want to start out with one of these areas and kick us off.
Jose Luis Blanco:
Yeah. So a couple of reactions here. I think there's definitely a lot of buzzwords going on. And I think that I would like to separate the reason for that is because I think people sometimes actually confuse you know, technologies that aren't available or venture capitalists sounding, right, or that money is flowing to actually develop reinvestigate versus technologies that are really being adopted, whereas having mass adoption. So we'll make that distinction in the beginning of it. Right. So it's just been, you know, two or three or four, what you say is like, really, if I think about technologists, for instance, that are already impacting the way we work, obviously there's analytics that actually are being applied or advanced analytics are being applied on the field for early flags for projects. How do you explain, or the main factors that explain what a project can turn profitable non-profitable so you can, you can do a reduction analysis to actually do that, and even just forecast that you can definitely do it, you know, analysis of bidding and bidding factors, or even you can apply it to other electronic design for instance, right.
Jose Luis Blanco:
Which is starting to be widely used. Right. So there's things that are already happened, right. When you think about some of the things that may happen in the future, or maybe starting to happen, but not fully implemented, that's when you start entering like a world of lack of potential digital twinning, construction, or potential, like, you know, artificial intelligence where we actually fully explain, I don't think we're doing artificial intelligence in construction, per se right now, I think we're starting to do machine learning. And actually my, my actually disagree with that. I'm not, but actually that is a little bit like how we see. So I think the big, important thing for me is like all these technologies we're exploring and what should we be talking about all of that. Right. And, you know, venture capital is funding as soon as you get amount of them. And we're seeing a lot of them, the ones that actually read being adopted, I wouldn't say that at scale, they started to be adopted as a sizable pattern actually are much limited. I mean, they made it to analytics and we made it too, obviously maybe generated the design, some machine learning applications from project planning in advance.
Jose Luis Blanco:
[Inaudible] ....some Of that is implemented. I just want to hold on. When you say digital twin, the sec for various specific kind of use cases or a specific like areas who still are like ha a little bit like far away from a fully functioning digital twin, we understand in aeronautics to where we understand, you know, their industrial processes. Anyway, that's my perspective.
Mike Haley:
Yeah. I, I think Jose I makes a great point about, you know, I think of it as the hype cycle, right? And the reality is all technology goes through a hype cycle and terms like artificial intelligence, machine learning are, are hype terms. Now we deeply believe in artificial intelligence and machine learning and digital twins, but they have to be ready to Joe's point. One of the things I would add is I, you know, I think the things that are real today, like you said, are our analytics computational methods. You mentioned that Heather as well, the ability to explore alternatives, I think that's becoming a fairly robust capability today. When we start coming back to that systems aspect of things that we were talking about earlier, that's where it starts becoming complicated. And I think this is a big role where machine learning can actually play.
Mike Haley:
If we are to build - digital twins, I've also been around for actually quite a long time. And as you said in other industries too, but the difference is the future to have to understand the system. If they don't understand the systems, they're not correctly reflecting the situation and you're not going to be able to optimize your solutions correctly. The only way I believe you're going to be able to make correctly representative digital twins in the future is through sampling. The world is through measuring the data, learning from that data, generalizing those patterns, and then placing them within that digital twin. And then you, then you leverage that digital twin to optimize your designs and look for alternatives. But that's a pot. That's a path we're on. We're not there yet today.
Chris Luebkeman:
I think one of the interesting things with all of those is, as you said, Joe there's, there are buzzwords and there are many different interpretations. We can look at them with starry eyes and say, you know, I can't wait to do a digital twin and others get terrified of the thinking of the matrix coming down upon us. But as you've asked, I think it's, as we're talking. It's really critical that every firm, it makes the effort to learn about them. Both the potential as is implied by the technology tool makers, but also from those like Jose or Heather, or my other colleagues about what we're seeing is little small implementations that are showing success. So some of the data analytics for mobility and how that's able to really begin through the digital twinning of mobile networks and, and train systems of our airline systems actually to say, ah, okay, well maybe that works there.
Chris Luebkeman:
Maybe I could work on our proposals for this project, if we could try something. You know, I think so for me, the key with the buzzword is that our firms are prototyping a little bit and they're having a person or two who they give a freedom. What say one degree of one degree of freedom to try this. So that when the, when the client, the project, the tools are all right, that we're ready and it doesn't take yet another three years of ramping up to figure out what the heck it is. And I think that's, that's my 2 cents on that.
Heather Wishart-Smith:
Yeah. Joe, I can give a couple of very specific applications if you're interested. Yeah, yeah, sure. So starting with digital twins on water treatment and industrial water plants. So we've got a tool called replica that allows us to optimize those systems to prevent overflows in the event of emergency response, do a lot of scenario and what if training? And it also allows us to optimize the design and optimist and operations and maintenance. Another example for data analytics is for NASA at their Langley site in Virginia, we have about 120,000 sensors that are all around that campus. That measure things like vibration temperature, humidity, and we use predictive analytics and machine learning to be able to anticipate when something might break, which then leads to benefits like improved safety. You don't have to send somebody out to just regularly change a fan belt or whatnot improve reliability.
Heather Wishart-Smith:
That is a huge aspect of it. A site like NASA, they really do need to keep their site going and not have these unexpected outages also financial benefits, money money that saved and energy efficiency. And that we've had - we didn't start with 120. We started with, you know, you know, I think it was a few thousand or something like that, but it's been going on for about four years. And it just goes to show that there are a lot of opportunities in the built environment to be able to harness these technologies. I think we probably, you know, as far as specific discussion about artificial intelligence, but when, you know, when you marry that with automated design, we've been able to automate the design of you know, replicate some some very re repetitive sorts of components, say of rail or other things that, that are used quite frequently. But then bringing that and taking the learning again, starting small. So I mentioned starting smaller with Langley, starting smaller with some other things, learn from that and then be able to use it to scale even larger.
Kevin McMahon:
Joe, we have a pretty interesting question following up with what the panel just talked about from the audience. And it's with the ongoing industry evolution of technology is all for the panels of describe and the new graduate backgrounds that are not necessarily all engineering, traditionally related vertical integration of team, perhaps some of those team members being around the world. What impact does the panel see relative to professional engineering licensor requirements? Also coupled with the political issue today of making sure that America stays strong in engineering and doesn't outsource all the talent, like the manufacturing issue that we're well aware of.
Joseph Bates:
Good question. Anybody want to bite that one?
Chris Luebkeman:
So I I'm perhaps not the right person to answer this one. And I put that up front because I'm no longer licensed. So I really probably don't have the right to answer that question. I think what is critical is there, look at what the responsibilities are and who carries the responsibility because to me, a professional engineer in Switzerland, you don't need to have us go through a special, another licensing exam because the education is supposed to prepare you for that. But at the end of the day, it's who carries the responsibility. And what do you want to trust? Do you want to just, you want to trust a degree or do you want to trust actually that someone has proven their capability to make the right decisions. So I think it's that trust and I hope I've given Heather enough time.
Heather Wishart-Smith:
True friend, Chris, thank you. Yeah. Yeah. I think that's a, that is a great point. I am still licensed. But I think it's, yes, it is trust. I think it's important to recognize despite the fact that there are many forces out there in various States trying to diminish the value of the license and great organizations like ACEC, like NSPE had been working hard to show that value. So despite those forces of trying to diminish the value of it at the end of the day, I think we need to remember that technology is a tool. So the tools have evolved. It used to be that professional engineers just worked at the drafting table. Then we shifted to computer aided design, you know, and then we've, we've evolved. We've got, you know, all kinds of different tools, but the technology is just a tool we still need to, as Chris said, trust the people who are applying the tool and that's for the professional engineering, licensure comes in.
Chris Luebkeman:
Good job Heather, thank you.
Joseph Bates:
So in the interest of time, I'm going to go ahead and move on to the next question that we have here. Okay. We could, we could probably have a round table on each one of these questions. This next one. I'd like to direct it at Heather and, and Chris as well, actually. How is, and you all have talked a little bit about this already, so maybe dive a bit more into this, but how will the technology affect the culture and the collaboration environment of engineering firms? You know, we talked a little bit about will, and there was a question about, will it work different places around the world, but in terms of the culture, how is that going to be impacted by technology?
Heather Wishart-Smith:
Yes. Would you like to start, or should I start and give you some time to think...
Chris Luebkeman:
You're on the edge of your seat and ready? So go for it.
Heather Wishart-Smith:
Okay. so we've already talked about that. I think there's going to be - several of us have said that we think that there will be a greater focus on cross disciplinary work. Innovation, pretty much demands it. And we, we can't just complete our work in silos. We need to have these multi-disciplined teams and these multi-disciplined teams, can't just be the disciplines they need to include the business model. So the HR piece, the finance and all the rest, that should be part of the development of new solutions. I think a key way of doing this is, you know, at least in my role is by embracing innovation within the workforce that we have and that's by promoting collaboration.
Heather Wishart-Smith:
So we need to teach people across the business to be able to collaborate, to be able to network so that when that real work does happen, they have that muscle memory of the collaboration of the innovation. And I mean, you know, in our industry, it's so difficult because we're built on a billable hours culture, it's been this way, you know, for eternity. And there's also a performance unit kind of mentality to the engineering industry where you know, it's, whether it doesn't matter how your company is structured, whether you're structured in it by geography or by discipline or by market, there's still silos. And so we need to find ways to promote and, and sustain the breaking down of the silos. Many firms are, are, are structured to promote and sustain them, but we need to find ways to break them down. They're hard to break down. But I really do think that the firms that endure and those that will be successful are the ones that are successful in doing that on breaking down those silos.
Chris Luebkeman:
So I agree with fully Heather and I want to bring up two more aspects. One is cooperation, we are going to be in an increasingly cooperative and competitive environment. And I think many firms already, and many of us already understand how you can compete and still be friends. And this is one of the things I always enjoyed. When I was got to travel, go down to Australia and watch a sort of Australian rugby game or rugby, you know, and people would literally like without pads, try to beat the blank out of each other, but nobody really did anything where they couldn't go have a beer afterwards and they would respect each other from, you know, the grit and their cleverness and how they played the game. But you never played dirty. Cause if you played dirty, you know, you couldn't have that had that beer.
Chris Luebkeman:
And this is something which I would like to hope that we can also aspires - not necessarily Australian rules, rugby. It's a crazy game, all due respect, Mike, it's crazy. But this idea that just because we're competitors does not mean we can't always be good friends and I truly believe we need to work more on the second part. I think we're very good at the first part. So I think so culture is actually a manifestation of both the written and unwritten rules and how one treats each other. And it's the written and the unwritten rules. And part of your question there, Joe is about culture change. So part of the question that has to be, as we look at ourselves and our firms, what is our culture? And do we actually understand what the written and unwritten rules are of our firm? And if you haven't asked yourself that, and not just what you think as a principal, what the culture is and you say, well, our culture is openness and you walk into the office.
Chris Luebkeman:
And as soon as you walk in, everybody puts their head down and they're afraid of you, but you can say it's open, but the reality might be a very different thing. So to actually have a real conversation about the culture that we need in order to be successful in the new economy, in the digital transformation and one and one more thing, Jose, and it's all you said. So for me, the most important thing that we could say with this is, and I support Heather is it's not just a technology, but it's actually having a real conversation about our firm's culture and what we wanted to be slash needed to be.
Jose Luis Blanco:
Yes, just 10 seconds of this. I think that there's clear, there's a very clear link between performance and health, right? Health critical part of that is culture. And I think that over the past three months with COVID, I think we shift towards a working remote environment and we all will be surprised how fast we've been able to adapt to that. Right. but I think that some of the challenges of the issues will culture are going to start to appear in the coming months. And it's my belief that you can sustain. You can potentially sustain our existing, strong cultural, remotely. I don't think you can build the cultural remotely, or you can rebuild a culture remotely. So that's something that firms will need to, you know, when we're talking about what we're hearing about are they working from home, you know, half of my staff working from home and things like that. I think the implications of cultural implications of that I get to be seen, and we just need to pay attention to that.
Kevin McMahon:
With lifelong learning, that a lot of the parents have mentioned, and the ability for more experienced engineers to learn new tools and skills, maybe it's more from Mike's first answer, or are the tools keeping pace with the expectation of learning curve of designers to shorten or eliminate the learning curve to use these tools?
Mike Haley:
No, I wouldn't say they are. I think there's a it's, it's, it's a very, it's a, it's a difficult problem because I don't think it's well understood today. I mean, we, we still live in a world with traditional educational cycles, traditional university college, whatever it may be, get your, get your certification, do that. But those are the cycles we live in. So those are the models we have today. There isn't many models that, that, that, that have this sort of rapid learning world that I referred to for. I mean, some of the only models today are actually newer technology applications. Things you might get on an iPad that people are learning supervised there's there's ideas. There's these hints. I think all over the place as to what these are, I would hesitate to think of a single really, really good example that exists in the world of technology today.
Mike Haley:
I can tell you, in our research group, this is a very large part of our research objective. And it's precisely for this reason is that we don't actually know the right ways to do this. We are doing experiments in our software. We were introducing features that help people understand how they're learning the software, how they compare to others who are learning it, what are their patterns of progression through the software? And as we do this, we are gradually introducing more tools, but we're also learning at the same time. So I'm not quite sure what that looks like yet, but we don't have an option. That's the point though, we have to do this. We have to make this, the nature - tools cannot just be about taking what you do today and automating it away. Tools have to be about making you more effective and making the combination of human and machine better at the end of the day.
Chris Luebkeman:
No, I think that's great. The other thing I think so fascinating, it was Kevin with that question is the micro-learning. And I have two 20 something year olds one's graduated. One's just about to, and you know, they, they do micro-learning if they need to learn how to do something, they take and look on YouTube and they find a little burst on how to do it. And then all of a sudden they know how to do it. And I just, it's hard for me of a different generation to think that way. I'd rather call up Mike and have Mike explain it to me and say, hey, you know, and talk to him. And my son, George would just rather just look at YouTube, look it up. And he actually doesn't care what language it's in, because if it's a tool, he can just watch the strokes. And sometimes he'll look at something in different languages, because it's just interesting to see how someone's designed something slightly differently. It just kind of blows my mind, you know?
Joseph Bates:
So I, again, I just want to keep us moving here. I apologize for cutting off these great conversations. I want to this one's just for Mike, and then we're going to, we're gonna move to the last questions here, but Mike, how, how are people going to pay for this? You know, are certain firms going to have an advantage, the big firms, because they can afford to pay for the technology and the education and the taking the non billable hours to learn it, what's going to happen there and how will the small firms catch up?
Mike Haley:
Right. So, I mean, you know we're seeing a lot of new business models around how people pay for software, right? So, I mean, we've, we've moved to subscription models which make billing more consistent. And over time, we're also seeing the emergence of capacity based models. And, you know, there was a time not too long in the past where there were, there were products and tools that we make at Autodesk that very few firms, unless you are a massive firm could actually afford, you know, you would, you would only use those tools if you're a certain size that doesn't actually make sense in a capacity based world. So if you're paying for capacity, if I'm a small, if I'm a small firm and I need to run say three structural simulations a week, if I pay per structural simulation and don't have to pay an enormous amount of money for the software upfront, then it doesn't matter that I'm a small firm versus a big firms.
Mike Haley:
So I think we were seeing these more flexible models that, of course they relate to the cloud, they relate to those sorts of things. And I think, I think there's an interesting difference between large firms and small firms. I think large firms have an inertia that, that, that they have to overcome, but they also have, they have the capital, they have the assets, they have the money, they have the ability to do some of these things only. So the firms lack what Heather were saying. Firms that have been doing this for awhile, actually have a massive advantage because they are there. They are able to act on it. On the flip side, the small firms are nimble, right? They are flexible. They starting up. In fact, their secret sauce will be adopting these very kinds of technologies that we're talking about right now, data in the cloud work from anywhere, flexible learning, bring the data together. Use, use generative design, use, use digital twins, use insights, use these things. And those will be the folks that will win better. But I do believe in the sort of flexible business models that allow everybody to leverage all of the technology.
Joseph Bates:
Okay, great. So I'm going to ask the final question for each of you, and then we may have time for a couple of questions. Kevin Jose, I want to start out with you. I know you have to log off just a couple of minutes before the rest of us. So the big final question is what is, what is the firm of 2040 look like? You know, put you put on your thinking, cap, your wizardry, whatever you want to call it, your crystal ball. What is the firm of 2040 look like Jose? He might be gone. Oh. Did we already lose them? Okay, well sorry about that. I thought we were going to have him for another five minutes, but so let's just go ahead and throw that one over to Heather.
Heather Wishart-Smith:
Sure. So I think that we're going to see very few of the traditional A & E's in place. I think that line between technology and design it's, it's already been blurred. I think it will become increasingly blurred. Some examples. We all know about Sidewalk Labs and their smart city project in Toronto. And, you know, yes, I know it's, you know, that project has been terminated, but it they're going to come back in a different city with a different model, with more privacy controls and all the we've seen it with Elon Musk, the Boring Company, and Hyperloop pretty much with no past performance, they've won large scale tunneling projects. You see it with tech companies with autonomous vehicles. Just what was it two weeks ago with space spaceX just launched America's first private company to do so here in America. So that line is really becoming increasingly blurred.
Heather Wishart-Smith:
So it's really going to result in the increase in the skill set of firms. So tech companies, I think, are going to start acquiring more traditional skill sets, maybe by buying some of these more traditional A & E companies, especially as the owners age out and traditional companies are going to be acquiring the tech skills. That's maybe not as much through acquisition, but through training, by hiring different people. It's funny at Chris, I love your term of coopertition in, I have a colleague at Jacobs who refers to it as competitive-ates. These are where sometimes you compete and sometimes you collaborate together. Taking what Chris said earlier a little bit further. I always try to remember that today's competitor could be tomorrow's client because this is such a small industry. We all have competitors who have since become a clients but, you know, with these competitive-ates, cooper-ates competition, it's really about collaborating together to address these new market opportunities because alone, we're probably not going to be able to get there. So it comes back to your behavior, your home, we talked about earlier, your mindset, not being risk averse, being open to new ideas. And if you want to endure, do not get too comfortable in your silo.
Joseph Bates:
Great. It looks like we have Jose back Jose. I wanted to ask you before you have to jump off, what does the firm of 2040 look like?
Jose Luis Blanco:
Well just kinda like very, very interesting question. I mean, I wish I had a crystal ball to actually explain all that, but I think that, I think in my mind, if I just summarize what I see the firm of 2044 as like having a very different demographics in terms of like the roles that we have and have been there for 34 years I'm very doubtful that we're going to be there. Right? [inaudible] The projects that we have right now, many different type type of led professions in there and professions that don't even exist as of today. Right. I expect us probably hopefully it'd be again, probably much more remote, but also with some sort of physical presence because in the end physical presence, local presence, because in the end, I think that the work that we do is not only even the built environment is an enabler for many of the things and we need to listen locally to be able to deliver globally.
Jose Luis Blanco:
Right. So that's something that also, I think the firm needs to have. And I hopefully I hopefully like you by 2040 as is like in a few years time, which is time you know, infrastructure and the brother engineering space is being seen as a critical part of how people, you know, how will you enable how people live, work and play. So hopefully we will see engineering to be playing even a more integral part in people's lives than it even paying today. So maybe I'm being too optimistic, but those are the things that I would personally see. I see all these revolutions that are happening is also like almost like an opportunity to put the engineers back at the center of so many different things that we can do to improve our society going forward. So again, maybe I'm a little bit of like an optimistic, maybe I'm just like a little bit optimistic, but those are some of the things that I would expect to see in digging the farmer to 40, like diversity from backgrounds, diversity in terms of likely for him elements being much more at the core of how we work, play and live. And and those are some of the traits that I expect.
Joseph Bates:
Great. Thanks Jose. Mike, what about you? And then we're going to add, go to Chris.
Mike Haley:
So I, since we're a group of optimists here, so I'm, I'm I'm an optimist as well. When for me, a lot of it comes back to the competition thing that Heather and Chris have both talked about, but looking at it at a knowledge level I think there's an enormous amount of knowledge that exists across the engineering architect of the entire building industry that is mostly common, but it's not always shared or is really shared. And I think by 2040, I see there being a strata of, of knowledge be a digitally represented, hopefully that is then is available to everyone. It, again, I used the term, you know, raising the sea, raising all boats, right? All boats are naturally floating at a higher level, which allows the competition then to actually happen at a higher level. The difference between firms is no longer at this lower level that everybody is benefiting from the shared observations, perhaps it's the performance of certain buildings or performance of certain decisions or materials or processes or whatever it is. So I really do see a more collaborative world centered around knowledge sharing.
Chris Luebkeman:
So for me, well, the first thing that I do whenever I asked a question like that, Joe, is I think of, I go 20 years back. So if we go back to two year, 2000 and think, where are we as a practice, as a world, they're all freaking out because we thought our computers were going to blow up, right? And the world was a, I would argue a very, very different place 20 years ago. So I'll then go forward and think 20 years, what's the context going to be of the firm 20 years from now. And so we will have massive water stress globally. We're already seeing that in the United States, North America. So we will see mass migration. We're going to have a political stress due to migration, which we have not in our lifetimes yet even begun to experience.
Chris Luebkeman:
And so therefore we're going to be called upon to solve problems, which are not just technical, but have a social dimension in a way which is quite profound. And I'm not quite sure if we're going to be up for the, up for that yet right now, the firms aren't. But I think by then we will be, I think there by 2040, we are always going to be designing and full artificial reality. And we'll be using virtual reality in construction sites as an absolute norm. It's gonna be like, duh, can you believe that we actually did this once without it just in the same way. Now we can hardly imagine using a slide rule, which I think I was the last class at Cornell to actually use, you know, and I think, and so this is going to be a new, so let's means then if you're doing in VR/AR or that means you don't have to be co located in any way, shape or form.
Chris Luebkeman:
So all of us can be in a design meeting right now and actually really interacting with haptics so we can push and pull and really feel that I think by 2040, we will have climate legislation, which has been a long time coming, which will then have a different paradigm shift on how we, and what we designed to. So the makeup of our firms will also be very different and what's going to be needed in order to, for us to design for things which will be fit for purpose because the purpose will be not just engineering specification. And I think that's so, and then if I think about economically, we will have gone through two recessions. We're about to hit one and we will at least go through another two within 20 years. And I think we'll go through to identity crises as a profession. We're kind of in one right now, we're doing, what's our role.
Chris Luebkeman:
I think we'll go through a couple more as these new tools and these new challenges come. And so, and the last one, I'll say, no, politically there will be a new ballgame. There'll be a new empire, not quite sure which one will rise stronger, but you know, our rocket is kind of kicking over. We've seen peak Americas. And so, and then the question becomes, what will it look like in this new environment for consultants that we already have a lack of sand. We have a lack of, you know, so it's gonna be very interesting in how we design in a constrained physically constrained world. So these are gonna be new challenges, which I think is super exciting for us. And we have to be walk into this with our head up, right? Not looking backwards, but to walk with that with our head up and shoulders back saying, okay, it's, it's a new, it's a new game. It's a new quarter. Let's get the team out there and let's play ball.
Joseph Bates:
Great. Great, Chris, thanks for closing this out there. Daphne, I'm going to throw it back to you for a few final comments.
Daphne Bryant :
Thank you everyone for joining us. Thank you to our panelists for all your wonderful insights to our donors for making this session possible. We do have a short evaluation that we will send you this afternoon. So please share your experience with us and be sure to join us next week for our second session, the buildings we live and work in, that'll be on June 25th at 3:00 PM. Eastern. Thank you. Have a great afternoon and please stay safe.

The U.S. Economy: What Lies Ahead? A conversation with Dodge Data & Analytics' Richard Branch

Richard Branch, the Chief Economist for Dodge Data & Analytics stopped by the program to talk about the current state of the U.S. economy during the COVID-19 pandemic and what lies ahead for the A/E/C sector.

An Interview with Rep. Bruce Westerman, P.E.

Engineering Influence welcomed Rep. Bruce Westerman (Arkansas-4) to the program to discuss his career in engineering and in Congress.
Transcript:
Host: Welcome to another edition of Engineering Influence, a podcast from the American Council of Engineering Companies. It's a pleasure to welcome Congressman Bruce Westerman to the show. Congressman Westerman hails from Hot Springs, Arkansas and represents the state's fourth congressional district in the House of Representatives. He currently serves on the Natural Resources Committee and as Ranking Member on the Water Resources and Environment Subcommittee of the Transportation and Infrastructure Committee in the House. Congressman Westerman graduated from the University of Arkansas with a bachelor of science degree in biological and agricultural engineering. He is also a graduate of Yale University earning a master of forestry service degree or I guess master of forestry degree forestry. Yeah. which makes him doubly unique in Congress. He's not only an engineer, but he's also a Forester of which there are not many serving in the house right now. Pretty much just yourself, I believe. Just one. Thank you very much for coming onto the program.
Rep. Westerman:  Jeff, it's great to be with you and a real honor to get to be on an ACEC podcast and talk about engineering and how that's benefited me with my service in Congress. You know, I had a nearly a two and a half decade career in engineering before I came to Congress and really enjoyed that. I always tell people I like my job in Congress, but I could go back in and be an engineer tomorrow and be perfectly content.
Host:  Actually, I was here when you spoke to members of our senior executive Institute class last month here in DC about your background in engineering and how you've applied that to your work in Congress. And I think you made the comment of pretty much saying that, you know, members come up to you because you're an engineer and expect you to have answers on just about anything related to engineering. How has your professional work in the field of engineering helped you in your roles, both in your committee work and then also in the general work that you do as a member? And I believe you're also on the science committee previously how has that impacted your ability to be an effective Member?
Rep. Westerman: Being an engineer in Congress is you know, it's a, it's a small group of us that are up here. There's not many engineers and like we already said, there's only one Forester in the, in the House. So if you've got a particular area of expertise, people really want to seek that out, especially your, your colleagues because you know, they, they generally feel like they can trust you if you want to give them, give them information. But also being an engineer probably has some drawbacks because of things like our code of professional conduct where we're not expected or we're expected not to comment on things we don't have expertise in, whereas a member of Congress, you're expected to comment on everything. So I after my freshman term, I got voted the quietest member of our freshman class, and I always told them this because you've got two ears to listen and one mouth to speak with.
Rep. Westerman: So I'll try to try to be measured in what I say and try to be accurate in what I say. And of course Congress touches, touches everything from foreign policy to healthcare tax policy. And you really have to study and read a lot just to stay on top of the issues. But when those things come along, that engineering directly impacts it's great to have some history and background and the, the education and experience to be able to make pertinent comments on those those issues and add to the conversation. But I'll get asked to speak to a lot of engineering students around the country and I'll always tell them that the thing they probably don't realize now, but they'll will realize someday is that engineering is, is really glorified problem solving. You're learning a lot of science, a lot of math.
Rep. Westerman: You're getting all the tools in the toolbox to go out and solve problems. But what you really learn going through an engineering curriculum and what you learned doing engineering on the job is how to analyze issues, define the problem, come up with a plan implement that plan and solve a problem. That's beneficial. Whether you're in Congress, whether you're working in a corporation, working in your own business or whatever you do. Those problem solving abilities are very valuable to have. And I think that's the best thing that engineering gave me and prepared me for to come here and serve in Congress.
Host: That's really interesting point because one of the things that we talk about at ACEC and we're going to be doing a lot more with a new strategic plan that we just adopted on the role of engineering in society and engineer's not just as math side, the science side, but also the problem solving, the trusted advisor to clients of looking at a challenge and finding ways to innovative ways to solve those challenges and, and to apply their background and experience to, to those challenges. So that's a really interesting point. I do want to bring up the forestry side of things cause I'm a Penn State grad. We had a forestry program at Penn State. Not exactly Yale as far as, in terms of school, but I wanted to ask the question of how you got into and interested in forestry and where that kinda stems from.
Rep. Westerman: Yeah, it's kind of a unique combination, I guess having an undergraduate in engineering and a graduate degree in forestry. But I grew up in, in Arkansas, in Hot Springs, Arkansas, where I still live today, beautiful area, lots of national forest, a lot of private forest. And the career that I had for two decades was working for an ACEC member engineering firm. And we specialize in the forest products area. So when people asked me about my engineering career, I basically say that if there's some process that takes a tree and make something out of it, then I got the opportunity to design one of those facilities during my career. So getting a forestry degree was very natural and beneficial in the the business that I was in because you always started with what's the resource, what, what resources available and, and what's the most valuable product we can make out of that resource and what kind of equipment and machinery best fits the resource to convert that resource into a product that can be sold in the marketplace. And plus, I've always loved the outdoors.
Rep. Westerman: My Sunday School teacher was a world war II veteran. He, he flew in the bloody 100th bomb bombing squadron and he was just a fantastic guy, but he was, he was in the first forestry graduating class at the university of Arkansas at Monticello where our forestry school is. And I think Mr. Colepepper inspired a love for the forest and the outdoors and always wanted to go to graduate school. So it just, it worked out very well from a career and a personal goal standpoint to go study about trees. And another example of how being here in Congress and being the only, only person in the house where a forestry education and background, I work a lot on forest policy. And you know, the federal government owns a 193 million acres of timberland that's just in the Forest Service, but you throw in the BLM and the park service and you're between 250 and 300 million acres of public forest land.
Rep. Westerman: You know, today we're seeing the extreme forest fires in California and there's a lot of work that could be just be done just on the forestry side. And I'm really excited about it because forests are the link between clean air and clean water, which gets into a lot of the things that we as engineers work on. And you know, forests are the natural carbon sequesters. They're the most - good forest trees, the most pragmatic approach we can have to clean environment. And it's the best offensive tool that we've got. So I'm doing a lot of work in the forestry side of things here in Congress. And you know, one thing that we're really looking at is this new concept of mass timber and it's a new building system that's been done in Europe for quite some time, but we can now build buildings up to 18 stories tall.
Rep. Westerman: At my alma mater, the University of Arkansas, they just completed two five story mass timber dormitories. They had already built a mass timber library storage building. So it, it does a lot of, lot of things for you. Number one, it uses you can use locally sourced materials. These materials. Wood is on a dry basis, is 45 to 50% carbon, so it creates a huge carbon sink. It's a great insulating product, so you can build these buildings where they're sustainable and they don't use as much energy to operate and maintain. So a lot of positives with things like, wood, but then there's a lot of more research that can be done. We could use wood as feed stocks for chemicals. That's good feedstock for nanoparticles. I just saw something the other day where they've come up with a nano material made from wood cellulous that can be put into concrete that reduces the amount of Portland Cement and actually increases the strength and durability of the, of concrete. So the, I think the sky's the limit on what we can do with wood, which is a good renewable resource. And again, it, it's the lungs of the earth and the kidneys of the earth that cleans the air and cleans the water.
Host:  And that's really an interesting point. And actually we covered the mass timber issue in our most recent private industry brief that Erin McLaughlin in our office puts together. And again, that was the change in December of 2019. The ICC loosened the restrictions to allow buildings up to 18 stories in height effective in 2021 compared to the limit of six stories and commercial structures currently. So that's, that's an interesting, that's an interesting nexus between the forestry side and the engineering side.
Rep. Westerman: As a result of those projects they're in, in Northwest Arkansas on the University of Arkansas campus, a company just up the road, Walmart, announced they're building a new corporate headquarters. Now you think about you know, the largest company in the world building a corporate headquarters, 15,000 people, there'll be housing. So it'll be like a small college campus. I think they told me three and a half million square feet, but they're going to build the whole facility out of Southern Pine mass timber grown and manufactured in Arkansas. So that's a great story to tell, not only from the environmental stewardship side, but these local economies for timber has grown or in rural areas. And it's a, it's a good story about how we can help the autonomy in rural areas and do something good for the environment at the same time. And there's a lot of other, I've been told that Microsoft, Adidas I think Google, there's a lot of major corporations that are looking to use more of this mass timber in there Buildings.
Host: You know, buildings like that would fit in perfectly in Seattle and, and a lot of the Pacific Northwest especially. I do want to stay with the whole idea of economic development, but shifting over to infrastructure. You serve as the Ranking Member on the Water Subcommittee and of course WRDA is probably the most, the big bill that subcommittee is going to be working on for the Congress. That's a critical bill for our ports, harbors, inland waterways, locks, dams, just all of that, not just the, the seaside ports like Charleston or Savannah, but also the interior - moving goods around the country. Now with a lot of the members who listen to the podcast, they're getting a lot of their news from CNN. They're getting it from Fox and they're not hearing everything that's going on. You know, at the granular level. Where does the WRDA bill stand right now and where do you see when you see as the prospects of getting that through?
Rep. Westerman: So we've got a good track record going on WRDA and we certainly don't want to disrupt that. I believe we've the past six years or maybe eight years, we've got a WRDA bill through Congress. I know the whole time that I've been here, we've got WRDA bills passed on a two year cycle and there seems to be bipartisan support to get a WRDA bill out next year. And I will say serving on T&I, and actually being the ranking member on water and environment subcommittee. I was very fortunate in this Congress, which seems to be highly partisan with, you know, the impeachment issues and everything else going on. We've got a pretty good track record so far on the water and environment subcommittee. We just got a bill passed off the floor to use the Harbor Maintenance Trust Fund to actually develop and improve harbors as it was set in place to do you know, nearly, you know, nine to $10 billion in that fund.
Rep. Westerman: But it wasn't getting used to maintain harbors and it was put strictly put in place for that purpose. So I'm glad to see we pass it off the House Floor in a bipartisan manner. I hope the Senate will take it up and get that signed into law. We also just out of Committee this week we passed the the, the loan fund for wastewater systems. And I think that's a great opportunity to go in and you know, have the funding mechanisms so that cities can, can borrow the money to repair these wastewater systems, which the, I believe it was American Society of Civil Engineers gave our wastewater infrastructure a D plus grade. And I know as I travel around in my district there's a lot of work that needs to be done on both wastewater.
Rep. Westerman: And potable water system. So we're, we're getting bills passed out of committee off the floor. Those, you know, it doesn't usually make Fox or CNN when you pass a water bill out of the House, but it makes a lot of difference across the country. And I feel very fortunate to be working on that. I'm really looking forward to working with the, the Subcommittee Chairman Grace Napalitano from California, Peter DeFazio, now the Democratic Chairman, and then Sam Graves who is the Ranking Member. We've got a commitment to, to get this word of bill done. And as you mentioned, it's very important to many parts of the country. You know, our navigable waterways took a beating in the flooding this past past spring and summer in my district and in many other places in the country. We've got a lot of work to do on that.
Rep. Westerman: There's a lot of work that needs to be done on again ports and harbors deepening channels and that sort of thing. So there's, there's no end of, of opportunities and good things that we can spend money on that are, that are good for the country. And I think part of the reason we have a federal government, you know, provide for the common defense and, and take care of interstate transportation systems and that's what T&I does. So those are the things we should be prioritizing and putting our funds towards because it helps grow the economy and and helps, you know, the country grow, which helps us be able to provide nice things and, and people to have jobs and find, make their own way through life. So excited about what we're doing on the, on the water subcommittee.
Host: And then I guess just to kind of wrap it up, I mean it, with everything going on in Washington, you know, it's so dominated the headlines by intrigue and pretty much inside the beltway, kind of partisan squabbles because it, you know, gets ratings. But you know, for your constituents and for members in the engineering profession out there who are listening and saying, okay, what's Congress doing? I mean, what, what message would you leave them with? As far as what Washington is doing and, and how things are, are looking at the end of the year and may shape up for for 2020?
Rep. Westerman: Well, right now I would, I wouldn't give Congress a very good grade on what we're doing. I mean, we're operating under a Continuing Resolution, which is been a huge pet peeve of mine since I've got here. If there's, if there's one thing I would, if I could change it and I've worked hard to try to change it that's to get us back to what I call regular order, where we do appropriation bills. We debate those bills in the open, we offer amendments on the floor, pass all 12 of them out of the House. And if the Senate would take those up and go through the same process, we know our fiscal year ends on September 30th every year. And we need a new budget by then. We know the timeline, we know what needs to be done. We're just not getting it done.
Rep. Westerman:  And that causes all kinds of problems. When you look at, we don't even have a Defense Authorization bill done this year. And, and that's one of the primary reasons to have a federal government is provide for the common defense. If, if we can't get that done, if we can't get a budget done we really should be ashamed of the job that we're doing here. Now we can talk about some positive things on T&I. There's some small things that we agree on and they're getting done. And in the big picture, the politics are getting way too much in the way. And with the 2020 presidential election coming up with all the talk about impeachment it's really taken the focus off for the job of Congress. We've still got a huge, huge issue with healthcare in this country.
Rep. Westerman: We've got huge issues with immigration we need to be addressing. But there are a lot of us that are working on those policies and we've got bills drafted and we're ready to go. But you just can't get it in committee. You can't get time on the floor. The USMCA, a trade agreement that would be great for our country has got bipartisan support. You know, Mexico is now our largest trading partner. So you'd have your first and second largest trading partners with a new agreement that would benefit farmers, benefit the whole country. And we can't get it on the floor for a vote. It could've passed two months ago with bipartisan support. So that's frustrating. But again, engineers are problem solvers and I keep looking at it, you know, how can I make a difference? How can we change this?
Rep. Westerman: And it, a lot of times it's a slow change. And a lot of times it takes changes in leadership. It takes changes in which party is in control. But I see light at the end of the tunnel and you know, in on the positive side of things is the economy's doing quite well. We could do, we could be doing better and we see pathways to make that happen and I want to continue working on that and using hopefully what I learned studying engineering and doing engineering for a couple of decades and applying that here in the United States House of Representatives.
Host: Well, Congressman, thank you very much. There's still a lot of work to do, but like you said, engineers are problem solvers and you're going to be here to help solve those problems. So really appreciate your time this morning and coming on the show and, and, and hope to have you on the future. And I guess today you have some votes and then you're out, right? The this is, this is the end of the week legislatively.
Rep. Westerman: Yeah. This is a fly out day. It's a you know, I love my job, but the happiest day of the week are when I'm heading back to Arkansas, back to the real world. And the people I grew up with, the people I love and the people I get to represent here in this this great job in the U S so we do have a vote today actually a vote on the impeachment inquiry. So I wish we were voting on a WRDA bill or something like that, but it is what it is. And you know, I look forward to continuing to work is a lot of the things that people don't see that are here in DC is that when most members of Congress are back in our districts, we're working as much there as we are up here in DC. It's a different kind of work. And with, I've got a large rural district, so I spend a lot of time on the road, but always enjoy getting back.
Host: Well, Congressman Bruce Westerman, thank you very much for being on the show. Again, this has been another episode of Engineering Influence from the American Council of Engineering Companies.
 

Private Industry Brief Update: Public Private Partnerships

ACEC's Erin McLaughlin provides an update on the new Private Industry Brief focusing on Public-Private Partnerships in the engineering industry. 
The Private Industry Briefs are available free to download on the ACEC website. Never miss an issue by subscribing here.