0:10

[inaudible]

0:10

Well welcome everyone to another version

0:13

of Topcon talks, construction. My

0:16

name's Marie lodge and I'm the senior

0:18

vice president and general manager for

0:20

the construction business unit at Topcon. And

0:24

today we have two fantastic guests

0:26

with us. We've got Kate

0:29

Foxwood who is the senior director of

0:31

government relations with a M

0:34

and we have Dariana Tani , who's ex

0:37

economists for the Americas for global data.

0:40

So these two are very knowledgeable

0:42

and , uh , on the topics we're going to cover

0:44

today. So I'd like to have each

0:47

of them introduce themselves to you. So Kate,

0:49

could you go first?

0:50

Sure. I'd be happy to Marie . Um

0:52

, it's good to be with everyone today.

0:54

Thanks to Topcon for putting this series

0:56

on and inviting me to speak. I

0:59

am Kate wood. I am senior

1:02

director of government relations for the association

1:05

of equipment manufacturers. I try

1:07

to make sure I spell out acronyms cause we

1:09

run around in Washington, DC. There's so many

1:11

of them, but so am represents

1:14

about a thousand off highway equipment

1:16

manufacturers in the construction,

1:19

agriculture, forestry, utility

1:22

and mining sectors. And I work

1:24

in the Washington DC office for AEM

1:26

overseeing our federal advocacy

1:29

efforts. Um, ensuring

1:31

that we are advocating for equipment

1:33

manufacturers, policy priorities

1:35

that include things like infrastructure, which

1:38

I have a feeling we will get into quite a bit.

1:40

Today. We advocate for rural

1:42

America policy. So policies that

1:44

are going to keep rural America strong,

1:46

such as agriculture policy,

1:48

rural broadband policy. We also

1:51

advocate for trade policy as

1:53

well as tax and then last, but certainly not

1:55

least, which I believe we may talk about a bit today

1:57

as well, workforce development policy

1:59

. So , um, suffice it to say

2:01

that we were very busy here in, in DC.

2:04

Um, and I'm just happy to be here to share some

2:06

updates on everything that's going on. Thank

2:09

you .

2:09

Okay. Uh, next we have,

2:11

Dariana

2:12

Tangible Roy , um , top comfort and ask him

2:15

these spoke CAS , um , um

2:17

, biting global data for, to

2:20

participate in this and

2:22

an economist of global data construction

2:24

on responsible for the Americas

2:27

, uh, construction coverage and

2:30

forecasts with a focus on the U S Canada.

2:33

Uh, the main economies, a Latino

2:36

Marico , including Brazil,

2:38

Argentina, Mexico,

2:41

Peru, Chile, Columbia , uh,

2:43

global data construction. We

2:45

borrowed these , uh , forecast data

2:47

on analysis over 91

2:50

countries and

2:52

also provide access to

2:54

150,000 , uh,

2:57

construction projects , uh,

2:59

for

3:00

Every sector and of

3:02

construction. And also

3:04

, uh, over 200 countries

3:07

, uh, global data cover

3:09

a range of industry from

3:11

a technology to healthcare,

3:14

to , uh , retail,

3:16

consumer and mining

3:18

and construction.

3:20

Fantastic. Well, as I said, you can

3:22

see both our panelists

3:24

today are well-informed on the topics

3:26

that we're going to cover. I think, you know,

3:28

our , today we just, as we go through this, we're going to

3:31

talk about just the economy in

3:33

us and in North America and

3:36

then kind of move into maybe with

3:38

the new legislation and a new

3:40

, uh, uh, administration

3:43

that's in kind of things that will impact

3:45

the construction industry. And then

3:47

just really get maybe into some more details on

3:49

the construction industry as a whole and the impact

3:51

or the issues impacts that we're having

3:54

today. So it's a start

3:56

with, you know, if we look at 2020,

4:00

you know, it was a challenging year for

4:02

many industries, but

4:04

the construction industry as a whole fair , pretty

4:06

well , uh, even given the

4:08

whole COVID situation. And

4:10

so I just would like to know from both

4:13

of you for 2021,

4:15

you know, what do you see as the outlook for

4:18

the upcoming year Gary on ? Would you like to?

4:21

So we spend that momentum in the U

4:23

S restructure industry would be sustained

4:25

this year. Uh, we spent growth

4:27

of 1.4%. Uh,

4:30

we race on the upside if precedent

4:32

Biden manages to pass his infrastructure

4:35

bill , uh, uh, also

4:38

, uh, although growth is expected

4:40

to slow , uh , slightly , uh

4:43

, in the first half of this year, due

4:45

to the efforts of epidemic

4:47

, um , the , um, restrictions

4:50

, um , the COVID-19 restrictions , uh,

4:53

we expect that the seen

4:55

efforts on biding coronavirus

4:57

relief package worth

4:59

1.9, 3 billion , um,

5:02

dollars, which is expected to be passed

5:04

by mid-March on top of that

5:06

900 billion , uh , in relief

5:09

that was passed last December

5:11

, uh, by the trauma ministration

5:14

word gave a boost to the industry

5:16

this year. However, we sped

5:19

that hard hate sectors,

5:21

such as stress, leisure, and hospitality,

5:24

and to a lesser extent, Prieto

5:27

airports and offices

5:29

will continue to struggle this

5:31

year. Although government efforts

5:34

to backs in aid , most of the us

5:36

population by the end of the summer, CU

5:38

allow these sectors to recover

5:40

faster in the second half of this year.

5:43

But we believe that the ongoing shift

5:45

to online shopping , uh

5:47

, which has accelerated during the pandemic

5:50

, uh, is creating less

5:52

demand for retail buildings are more

5:54

the mindful warehouse properties.

5:57

Also the shift to remote

5:59

working could also affect the

6:01

demand for new offices buildings

6:03

in the near term. Although

6:06

we believe that these will be

6:08

less of an issue as the pandemic

6:10

resize , uh, in

6:12

the medium to long term , we

6:14

expect that long standing

6:16

issues, Sasha Slack , skilled labor,

6:19

expensive land on pricing construction

6:21

material costs will continue to

6:23

hold back investment in the industry

6:26

in the coming years. Although we expect

6:28

by this more friendly policies

6:31

to work towards immigration, as

6:33

well as his long standing , um,

6:35

uh, his long-term infrastructure plan

6:38

to increase investment in transport,

6:41

clean energy housing

6:43

schools, broadband healthcare,

6:45

and high-tech manufacturing. If

6:48

these , um, in infrastructure

6:51

bill is passed through Congress, it

6:53

will create more opportunities for the growth

6:55

, uh, in the industry

6:57

in the years ahead.

6:59

Yeah, it sounds like there's a lot of unknowns

7:02

as we look at what's going to happen in the upcoming

7:05

year. Uh, you know, Kate,

7:08

we there's parts of the

7:10

economy and that are doing well.

7:12

Those that , that aren't when we

7:14

look at from a civil

7:16

side, cause we look at it from a top gun perspective

7:19

and some of our listeners what

7:21

their really best

7:23

segment the market that's important

7:25

to them. You know , what do you, what mega

7:28

regions do you see and what Mar

7:31

uh , segments of the civil construction side

7:34

we'll be doing well ?

7:36

Well, Dariana nail , you know , nailed

7:38

it, you know, and just outlining very well

7:40

kind of all the different kind of variables

7:42

that are at play here. And I kept hearing one

7:45

theme was Biden, Biden, Biden.

7:47

There's like such an emphasis being placed on

7:49

what the president's policies are going

7:51

to kind of , um, you

7:53

know, like promote and push through.

7:56

And , and then Marie , to your point, it's

7:58

all very unknown. Like there's a lot of

8:00

ideas being tossed around. There's like wild

8:03

price tags being tossed around. Um,

8:06

and then you get on the hit to the Hill to Capitol

8:08

Hill where there's the other, the other lever

8:10

of action that kind of is

8:12

, is dependent on all of this as well. Congress

8:15

is going to take all of these recommendations.

8:17

Um, so we'll get into that in a little bit, cause

8:19

, um, there's a lot of fun to talk about

8:22

with what's going on, on Capitol Hill with the us,

8:24

but to your question, Marie, about

8:26

regions and markets segments, you know, I think

8:28

to Dariana his point , um,

8:31

I think from a

8:33

CMS perspective, we protect that we'll see a

8:35

lot of activity in the infrastructure arena.

8:37

It's just continues to be not

8:40

just this past a couple of months, but even

8:42

during the 2016 presidential

8:44

election. I mean, we've been at this for about four

8:46

or five years every week is infrastructure

8:48

week, right? So I definitely

8:50

think there is going to be a lot of

8:52

growth and opportunity there in the infrastructure.

8:56

I think you're going to see a ton in it when

8:58

it comes to telecommunications as well. Specifically,

9:01

we talk about infrastructure. It's a really big definition

9:04

for alive means a lot of things to a lot of people, right?

9:07

Um, so beyond the traditional assets,

9:09

like your roads, highways and bridges,

9:12

I think the telecommunications industry is going

9:14

to see a lot of, a lot of boosts here

9:16

because there is so much conversation

9:19

about broadband access. Cause you've got

9:21

families and workers,

9:23

businesses trying to operate

9:25

at full tilt, you know, leveraging

9:28

, um, you know, systems that are just, we're

9:30

already maxed to begin with. And

9:33

members of Congress are

9:35

definitely are hearing that from their constituents.

9:37

And it's all I hear about. And we talk

9:40

to members of Congress as the need to

9:42

expand rural broadband increased

9:44

capacity. So to that

9:46

end, if you look at the COVID relief package,

9:48

that's working its way through Congress. Now that

9:51

Dariana mentioned, or you look at some

9:53

of the things that people are talking about in a bigger

9:55

infrastructure package that may come next,

9:58

there's a lot of money being , uh,

10:00

you know, put on the table potentially for , for

10:02

broadband , uh , both in urban

10:05

and suburban communities, but particularly in rural

10:07

communities , um, which has implications

10:10

, um, not only for the equipment

10:12

functionality, right, but also for the

10:14

industry, the utility sector. Um,

10:17

so that, that, those are kind of

10:19

my predictions. I don't necessarily have any thoughts on

10:21

the regions. I think everyone's going to

10:23

see benefit. I don't know that

10:25

there will be a section of the United

10:27

States where, you know, one will benefit over the

10:30

other. Um , I will mention to

10:32

try to answer that question because I hate being the

10:34

politician who just Dodges questions, but

10:36

, um , I'm pretty good at that myself.

10:39

Oh , I think you've answered it very well. I don't think you've been dodging.

10:41

I'm pretty good. But I will say though, there is

10:43

conversation that has really picked up steam

10:46

this week , um, about earmarks

10:48

coming back to Congress. So these,

10:50

remember these are member directed project

10:53

spending projects , um,

10:55

is the, is the nicer way of saying earmarks

10:57

and, you know, they were phased out , um,

11:00

and banned a couple of years ago. So they haven't

11:02

really been a tool that members of Congress

11:04

can use to show constituents that they're delivering.

11:07

But if we're to see a return of earmarks

11:09

, um, that's going to be a really interesting

11:11

, um, kind of indication of

11:14

where money in terms of the regional aspect

11:16

is going to be spent. So what members,

11:18

what members are going to have their projects prioritized

11:21

, um, how quickly they're going to be able to get

11:23

that money spent, because that's the , one of the other

11:25

big issues about your marks is that they oftentimes

11:28

get allocated and appropriated and

11:30

the money just sits there. Um, I was

11:32

reading an article recently

11:35

about in the Washington post that was reporting

11:37

on some earmarks that have been sitting,

11:39

you know, unspent for the past

11:41

10 years. Um, so , um,

11:44

and then I'll end this by saying that the earmark

11:47

conversation is certainly not done. There's still a

11:49

lot of skepticism on Capitol Hill about whether

11:51

that's actually gonna , um, it

11:54

happened ,

11:54

Whether that's actually a good idea. I gotcha.

11:56

Very interesting question . Yeah. Well,

11:59

yeah, you've covered a lot there. If

12:01

money hasn't been spent in 10 years, that project

12:03

probably wasn't very important to start with. It was, it

12:05

depends on who you talk to. Right. That's

12:08

exactly right. Yeah. Well,

12:10

yeah. So you have that broad band

12:12

, obviously with people working from home more

12:15

and more of it that certainly I'm sure

12:18

is a hot topic, but you brought up

12:20

that the legislation side of the whole

12:22

thing. And I think there's a lot of things that are happening,

12:25

your comment there on

12:27

infrastructure. You're right. We've been

12:29

hearing about that. And that's been in

12:31

the previous administration, that was

12:34

a key, you know , uh

12:36

, thing they wanted to get past . And

12:39

it just seems if you look at infrastructure

12:41

and especially for the transportation has

12:43

been a struggle for years to get

12:46

a constant funding going into that. So

12:49

with this push for the infrastructure,

12:51

what do you see happening with the upcoming

12:54

or potential upcoming bill? Is that going

12:56

to get through finally? Is there enough people on both

12:58

sides? That'll agree to that.

13:00

I think with regards to

13:02

the timing of the bill, I

13:05

think it is unclear how long it would

13:07

take to buy demonstration to pass it through

13:09

Congress, but it is likely

13:11

that the administration , uh,

13:14

would set , um,

13:17

deadline for September this year, which

13:19

is when the extension of the fixing

13:22

America surface transportation

13:24

app expireds , uh,

13:27

passing the infrastructure bill

13:29

will depend on

13:31

bipartisan support.

13:35

Uh , but , uh, these were required

13:37

, uh , of the precedent to work. We Republicans

13:40

lawmakers to find

13:43

common grounds. One of the

13:45

things that we expect, and one of

13:47

the things that we expect to see that

13:49

both parties fine agreed

13:51

on is 5g, as

13:54

Kay mentioned , uh , technology, broadband

13:57

technology to expand in rural

14:00

communities , um, and also

14:02

, uh, to also

14:04

electric cards investment. So

14:07

when we go to , uh, I think those

14:09

are the things that the Republicans

14:12

lawmakers on the Democrats

14:14

agree on. Um, but

14:17

I think , um, there is likely

14:19

to doubt , um, that

14:21

Biden would look

14:24

to pass , uh, his infrastructure

14:27

bill by using that budget reconciliation

14:29

procedure, which were require

14:31

like a simple

14:33

majority in the Senate.

14:36

And, but I think,

14:38

you know, I think Seastar , publican

14:40

student, like you said, in

14:42

the current fiscal year, I think the

14:45

, uh , Biden would have a second chance

14:47

to pass the true , you know, to

14:49

use it again. Yeah. Yeah.

14:52

I agree. It , Kate, you know,

14:54

you're back in Washington and you're interacting

14:56

with, you know, all the different

15:00

groups that are out there and both , I don't

15:02

even really see both sides. I mean, I look at

15:04

it when you talk to people at , out

15:06

there there's not anybody

15:09

who doesn't think the infrastructure needs

15:11

work, needs improvement. And

15:14

is it really that hard to get

15:18

bipartisan , you know , uh , uh, uh,

15:20

it's on something that's affecting everybody.

15:23

Do you see it really being a challenge

15:26

or you think this is finally something that could

15:28

actually move forward , uh,

15:30

for the new infrastructure bill?

15:32

Well , Mary I'm always an optimist when

15:34

it comes to infrastructure. I kind of have

15:36

to be , um, since I've been,

15:39

I've been at least a EMS

15:41

chief infrastructure cheerleader for a few

15:43

years now , um, so to speak

15:45

, um , and it's a role I'm , I mean, I'm very passionate

15:48

about, so yes, I do think that there is

15:50

at this point in time. So , um,

15:53

a collective kind of push

15:55

there is momentum to , to passing something

15:58

on a bipartisan basis to

16:00

Dariana his point, the conversation about how the

16:03

bill will be passed, whether they're going to pursue

16:06

the reconciliation, you

16:08

know, tool , um , would not make

16:10

that bi-partisan . And so at

16:12

this point, though, we are hearing from,

16:15

you know , the four corners of the committees.

16:17

So the , the two entities, the two individuals

16:19

on transportation and infrastructure

16:21

on the house side, as well as

16:23

the two leadership , um , members

16:26

on the, in the Senate environment and public

16:28

works committee, they're giving at

16:30

least industry groups, every

16:32

indication that they're going to get, they're going to start

16:34

working on this in a bipartisan fashion.

16:37

Um, there's quite a bit of competition between

16:40

the two chambers going on right now, because

16:42

you have, chairman's a Fazio who is

16:44

such an institutional. I mean, he

16:46

, his institutional knowledge on this issue is,

16:48

is amazing. And he , he passed

16:51

his , um , his highway bill

16:53

, uh, or surface transportation, reauthorization

16:56

bill out last year. Um, and

16:58

you know, he's in , so he essentially has a bill

17:00

already. So they're going to get to work on

17:02

that, you know, very soon. Um,

17:04

and I'm hearing that they're going to have a markup

17:07

in early may on his, with his

17:09

committee. So, and that's kind

17:11

of in response to a bit of , um,

17:13

a bit of gauntlet throwing

17:16

that chairman Carper on the Senate side

17:18

has said about his bill. Um,

17:21

he is kind of starting more

17:23

from scratch. Although the

17:25

Senate passed , the Senate committee passed a

17:27

version of the surface transportation bill

17:29

in 2019, which gosh

17:31

seems like eons ago, but

17:33

, um, that was under a different chair,

17:36

chairman Barrasso. So it's , he's

17:38

kind of has an opportunity to put his own Mark

17:41

on this. So it's going to take them a little bit more time.

17:43

Um, but we are also hearing that they are targeting

17:47

kind of a mid may timeframe. We could

17:49

really start to see things. And again, this is

17:51

very optimistic and again, on

17:53

the condition that they pursue a

17:56

bipartisan approach, that there's not a wreck , there's not an appeal

17:58

to reconciliation there. Um,

18:01

we may see something by Memorial day.

18:03

Um, I always get that question about timeline,

18:06

right? Um, but Dariana his point

18:08

is, is that the very minimum, the

18:10

surface transportation program will expire

18:13

in September. Um, they were unable

18:15

to pass a long-term reauthorization last

18:18

year, they kicked the can down the road.

18:20

Um, and so they have to do something

18:23

at least on the surface piece. Um,

18:27

as Dariana mentioned, president Biden

18:29

is, I mean, envisioning

18:31

something much broader though than just

18:33

roads highways and bridges. There's a lot

18:35

more entailed with his , that , that $1.9

18:39

trillion price tag. So how it's all

18:41

going to come together as still very much

18:43

being discussed , um, and

18:46

how the different committees that have different

18:48

jurisdictions over all these entities.

18:51

It's not just in one committee

18:53

in the Senate and one committee in the house. There's,

18:56

if you start talking about broad ban that

18:58

expands the scope of it. If you start talking

19:00

about public transit, that

19:02

expands the scope of it, it's a , it's,

19:05

it's a fascinating puzzle. Um,

19:07

but I do think that their

19:09

momentum is there. Uh , the president

19:12

is hosting lawmakers, you know,

19:14

at the white house, bi-partisan

19:16

delegations of lawmakers to talk

19:19

about infrastructure on a regular basis.

19:22

He's engaging his secretary of transportation,

19:24

secretary Buddha , judge. You're

19:27

seeing a level of stakeholders

19:30

coming together that we

19:32

haven't seen consistently in,

19:34

in, in when it comes to infrastructure. So

19:37

, um, so today

19:39

I'm optimistic about it. I don't know. Dariana,

19:41

I don't know what your thoughts are if I'm being too

19:44

Pollyanna, so to speak.

19:47

Well, I think it would take, I mean,

19:49

it , regarding to the timing of the thing for

19:52

Scottsville, I think it will take a beta of

19:54

bipartisan support and, and

19:56

I think the Biden administration,

19:58

there's no doubt that they will try to

20:01

use again, that budget , uh , reconciliation

20:04

, uh, procedure , uh, to,

20:06

to pass it through Congress. And

20:08

, uh, and I think , um, there's

20:10

that line for , for it? I

20:12

think they will say that that live for September

20:15

this year , um, because of

20:17

the extension of , uh, of

20:19

this bill, all of this, the surface

20:21

transportation ad bill

20:23

, uh, will expire , uh , at the

20:25

end of September. So

20:27

, uh, but I think one of these , uh

20:29

, as I mentioned before, that both

20:32

Republicans and Democrats agree on

20:35

are , um, the 5g investment

20:37

in 5g technology and investment

20:39

it also, and electric

20:41

carts and charging

20:44

infrastructure are the national

20:46

level. Well, yeah, hopefully we do

20:48

Get some , uh, compromising and

20:50

, uh , make some headway on

20:52

that because the infrastructure

20:54

bill would be very

20:56

important to our listeners here today.

20:59

So as we move on, we

21:02

look outside of the legislature

21:04

and we kind of maybe hone in on the construction

21:06

industry as a whole. You

21:08

know , one of the topics that Topcon has

21:10

been bringing up for years is

21:14

the lack of, you

21:16

know, development increase in productivity,

21:18

in the construction industry. As a whole, you

21:21

look at all the other manufacturing industries, they

21:24

have really adopted

21:26

technology and continue to grow and expand

21:29

construction is one of the largest industries in the

21:31

world. And yet, if you look

21:33

at it over the last, you know

21:35

, 30, 40 years

21:38

productivity has not gone up at all and,

21:41

you know, people have been doing it the old school

21:43

way and it's falling behind. Is

21:46

it going to continue that way? Or

21:48

are there things happening that realize

21:50

that we need to do things

21:52

differently to be more catch

21:55

up with the other industries that have already adopted

21:57

technology?

21:59

I think under the Byron ministration

22:01

efforts to raise investment in

22:04

technologies that capture and reduce

22:06

, um, cover and emissions

22:08

, uh, can be expected to accelerate

22:11

in the next years , um, we

22:13

can expect to see the government to

22:15

push forward its policy, to

22:18

accelerate investment in new technology

22:20

, such as electric carts

22:23

and charging infrastructure, as

22:25

well as investment in electric , uh,

22:28

smart electric grades

22:30

, um , renewable energy

22:32

resources, as well as

22:35

, um, efforts to

22:37

electrify the building sector

22:40

and increase energy efficiency

22:42

, uh, in a range of weights.

22:45

So we can also expect to see efforts

22:48

, uh, to accelerate investment around

22:50

the next generation of building

22:52

materials and key

22:54

technologies like battery

22:57

on , uh , energy storage

22:59

, uh, that can cop prices

23:02

for off electric cards on

23:04

increase the variety. Uh,

23:07

this will not only create millions

23:09

of new jobs , uh, but also boosts

23:11

the country's manufacturing

23:14

and technology centers. Um,

23:16

in terms of electric cards

23:18

, we, the precedent has plans

23:21

to restore a tax

23:23

credit, to encourage , uh, more

23:25

families to buy electric arts

23:28

. Um, he also have

23:30

plans to work with Congress, the

23:32

state and local governments and the private

23:34

sector to adopt

23:37

these technologies, and also

23:39

, um, invest in the construction

23:41

of a national , um, electric

23:43

charging system to

23:45

power the elect , uh , to

23:47

power. Then , um,

23:50

we also going to see effort

23:53

to install , uh , advance

23:55

, um, metering systems

23:58

to modernize the country's

24:01

electory greets , um, the

24:03

, which is going to help like

24:05

, uh, you know, to support

24:08

all the regional electric , uh,

24:10

markets. Um, we

24:12

can also expect to see actions

24:14

to accelerate , um, the

24:16

development of low carbon

24:19

aviation and shipping technology,

24:21

the construction of highest

24:24

SPE right, well networks , uh,

24:27

while many estates or local

24:29

governments in the U S have already

24:32

step up efforts to adopt

24:34

many of these technologies, the Biden

24:37

administration has plans to create

24:39

more incentives to accelerate

24:41

the adoption.

24:42

Okay. So yeah, if you look at that, that

24:45

carbon footprint trying to lower

24:47

that, and so from

24:49

a construction standpoint, you've

24:51

got most of your equipment today is

24:54

runs off of diesel and

24:57

Totoro to lower the carbon footprint.

25:00

You've either got to convert those to electric,

25:02

or those machines

25:05

have to run more efficiently. And that

25:07

kind of plays into what Topcon

25:10

as a company. And if we,

25:12

if we can double the speed or double

25:14

the productivity of the machine, obviously

25:17

then the

25:20

less carbon is being put into the field.

25:23

So that's where, you know, when I talked about technology,

25:26

you know, is going beyond just

25:28

, uh, the traditional ways in

25:32

some governments, you know, cause it's just not a , it's

25:34

a problem all over. And in some countries,

25:37

the government has actually

25:41

provided stimulus to get the contractors

25:44

themselves, to adopt technology where

25:47

they realize without incentive

25:49

for the, or helping the contractors,

25:51

they're going to continue to do the same way.

25:54

Kate is that you see any

25:56

chance of that happening , uh, in

25:59

the U S or, you know , in North America

26:01

where some of the stimulus would be to

26:03

try and get these old school

26:05

thinking more modern.

26:08

I would never, I would never say to my state

26:11

DOD friends that they're old school, I would probably get

26:13

a lot of raised eyebrows on that one, but

26:16

I worry you're right. That I,

26:18

and we talked about this before, about you , about

26:20

what other nations are doing in this arena. You

26:22

know, there are several different

26:24

recent iterations of legislation

26:26

, um, that I referenced in the

26:28

Senate and the house when , as it

26:31

turns, as it relates to the surface transportation

26:33

reauthorization that tackles the concept

26:35

of incentivizing technology adoption

26:37

, um, so relevant to

26:40

today's discussion, you know, as you were just

26:42

talking about Marie , there was language

26:44

included in, in those two

26:46

bills that would direct the secretary of transportation

26:48

to develop a program under

26:51

the technology and innovation deployment

26:53

program. That's a mouthful, but

26:56

essentially to promote the application

26:58

of advanced digital construction

27:00

management systems. So that

27:02

may not be as, as strong as a mandate

27:04

as you will, as you see in other nations,

27:06

like in the UK or in Japan,

27:09

but this would , um, you

27:11

know, in a gentle way

27:13

, um, seek to accelerate

27:15

state [inaudible] adoption

27:18

, uh, by doing things such as encouraging

27:20

them to weigh the cost

27:23

of digitalization and technology when setting

27:25

their project budgets , um, you

27:28

know, encouraging , um, you know, the

27:30

workforce development kind of piece of this,

27:32

trying to figure out how we're going to , you know, train the next generation

27:35

of, of , um, construction

27:37

workers to understand this technology.

27:40

And so having that language inserted

27:42

in a such an

27:44

important piece of infrastructure legislation

27:47

does indicate that there is

27:49

an understanding, you know, in the

27:51

halls of Congress, that we see that the

27:54

digital construction and technology has an important

27:56

role to play in the future. And

27:58

to Dariana his point about just the emphasis

28:01

that's being placed on green energy, green

28:03

infrastructure, electric vehicle charging. I

28:05

mean, this is, this is an

28:07

opportunity for, for

28:09

the equipment manufacturing industry

28:11

to make the case about how this technology

28:14

does things like minimizes

28:16

rework improves idle time,

28:18

all these things that will help reduce

28:21

emissions and kind of help the administration

28:24

and help , uh, secretary Buddha judges

28:26

goal of reducing administration

28:28

within the transportation sector. Um,

28:31

we just recently had a conversation with

28:33

some folks over at USD

28:36

. So these are folks who just got in,

28:38

you know, a couple of weeks ago. Um

28:40

, and they, you know, they have long, long

28:42

careers in, in , in transportation

28:44

, uh, whether at the municipal

28:47

level or at the state level or at the federal level,

28:49

but it was a really awesome opportunity to

28:51

present to them what the equipment manufacturing

28:53

industry is doing to reduce emissions.

28:56

So get the opportunity to talk about the

28:59

electric vacation trends that the industry

29:01

is seeing, whether that's a hybrid, you

29:03

know, or just, you know, full fledged electrification.

29:06

Um, and I think we got a lot of, a lot

29:09

of surprises from that meeting in terms of just,

29:11

they didn't know that that's what the industry was doing.

29:14

We talked about the technology piece and how

29:16

important it was for, you know, for

29:18

that goal that, you know, emissions reduction

29:20

goal with them. Um, and the

29:23

other points that we wanted to make clear, and we're going

29:25

to continue to emphasize those within the administration

29:27

and on Congress, as it relates to

29:30

kind of the environmental benefits

29:32

, um , as well as the emissions goal that they

29:34

have is that at least for equipment

29:37

manufacturers off highway equipment, it's

29:39

not the same as, as a personal as automobiles.

29:42

So the kind of emissions standards

29:44

and things and policies that you're placing

29:47

on personal vehicle use is

29:49

not, it is very different, you know, while the

29:51

industry is making advancements on things like electrification,

29:55

these, you know, they're not operating in environments

29:58

where there are charging and there's charging

30:00

infrastructure at the ready. Um, so

30:02

we need to address that. Um, there are safety

30:04

implications to consider when you're thinking

30:07

about technicians working on some of

30:09

this equipment , um, there's, there's

30:11

a little uncertainty about whether that's actually a safe

30:13

move for them. So , um, I

30:15

think there's, it's important to emphasize

30:17

to the administration that the industry is moving

30:20

forward and, and at a very

30:22

rapid pace much like was done with the

30:24

tier four, you know , engine emissions

30:26

, uh, you know, and , and those steps that were taken,

30:28

but that we need to be a partner with

30:30

them in that effort. Um, and,

30:33

and , you know, it should try to

30:35

avoid any regulatory

30:37

maneuverings that would, you know,

30:39

seriously hinder our disadvantage , the

30:41

industry, you know, at this time. So

30:44

, um, I guess what's the saying,

30:46

I'd rather be at the table than on the menu.

30:48

And so that's really what we were emphasizing

30:51

to regulators at DDOT a

30:53

few weeks ago. Um , and again, a

30:56

lot of really, it was really good dialogue,

30:58

a lot of, a lot of , uh , light bulbs

31:01

going off like, Oh, I didn't know that this,

31:03

you know, I just thought all this heavy equipment was just

31:06

diesel, you know, diesel dirty,

31:08

you know, and it was just a really good, and so

31:11

we're making inroads and, and, and converting

31:13

some folks to just

31:15

how advanced the technology is,

31:18

you know, in the off-highway industry

31:20

these days. So,

31:21

Yeah , that's a great point. I

31:23

think the, where we

31:25

are today, because things are changing

31:27

so rapidly is we need

31:29

to educate, you know, there's so many

31:32

things that are out there that can

31:34

change things to the better, but

31:36

it's a matter of just getting everybody on foreign

31:38

so they know what's available and not

31:41

there, the whole thing that was done with tier four.

31:44

I mean, people don't realize that

31:46

what comes out of a tier four engine today

31:49

is, you know, is

31:51

cleaner than a lot of the time that the air

31:53

that's coming into it and, you know, and try

31:55

to take that. So there is things that are happening

31:58

and there's a lot more that

32:00

, uh , needs to, so you, you

32:02

bring that up, you know, educating and

32:05

looking at the construction industry where it is,

32:09

you know, part of it. The other thing

32:11

is we're in the construction

32:13

industry is suffering is a

32:16

lack of workforce, or at least if

32:19

you talk to the contractors today,

32:21

many of them are saying their number one issue

32:24

is finding people. And

32:27

did seems to be that more of this

32:29

younger generation is looking to

32:31

get into computers or gaming

32:34

or something else. And yet

32:37

we have to have people in construction

32:39

cause we have to be able to do the

32:42

5g, to build the roads,

32:44

to build the buildings, you know, does

32:46

is Washington and do others

32:49

see this as a problem? And is

32:51

there a way that

32:53

we can change this trend

32:55

from what it is today?

32:57

Well, I think that is a key

32:59

issue on long standing issue

33:01

in the industry, the, the

33:03

, you know, the industry has faced in

33:06

the past , uh, years , uh,

33:08

and in particularly , uh, in particular,

33:11

the lack of skilled labor, which

33:13

is causing wage inflation

33:17

on leading to additional increases

33:20

in home prices and

33:23

as well as building costs in general.

33:25

So on a, is this

33:27

Carter gene home developers

33:30

to build more affordable houses.

33:33

So we think that by then , uh,

33:36

friendly policies towards immigration

33:39

, uh, could help address

33:42

some of these issues. Um,

33:44

the precedent has already passed a

33:46

number of , uh, secretary orders

33:49

, uh, related to immigration

33:51

around 11 so far.

33:55

Um , um, including the order

33:57

to stop the construction works

33:59

of the border wall. We met

34:02

sicko and he also

34:04

interviews , uh, an immigration

34:07

bill , uh, in February

34:10

, um, known as

34:12

the us citizenship

34:14

act of 2021

34:18

and to establish , uh , a year

34:20

pathway to provide

34:23

us citizenship for nearly 11

34:25

million undocumented , uh, people.

34:28

So the bill is part

34:30

of Biden's campaign proposals to overhaul

34:33

the entire , uh, the country's immigration

34:36

system. And he spread perhaps the most

34:38

ambitious , uh, bill , uh,

34:41

immigration bill that any administration

34:44

has put forward in decades.

34:47

I think , um, whether the bill

34:49

, uh, I think we'll get

34:51

passed through Congress , um,

34:54

I think that will depend on

34:56

again on bipartisan support

34:59

and even the Democrats

35:02

at a slim majority in the Senate, it

35:05

would , um , require

35:07

a Biden administration to gain

35:10

10 Senate Republican boats to

35:12

a boy, the filibuster,

35:15

Yeah, we getting more workers in

35:17

would definitely be helped

35:20

to it. You know, there's a lot of talk about

35:23

train increasing the minimum wage States

35:25

have done it, and they're maybe looking at it from

35:27

a federal standpoint. You know, the

35:29

construction industry actually

35:32

pays very well and,

35:35

you know, there's people that are at,

35:37

in different ways to make a livable salary

35:41

and a career. And

35:43

I think, you know, the construction industry is often

35:45

overlooked for that. And I

35:47

know AEM has really been

35:50

targeting some of that. Kate , can you share

35:52

any insight as to what you guys have been doing?

35:55

I'd be happy to , um, to

35:57

build on that point about just the,

35:59

the, the compensation

36:02

, um, benefits in the construction industry

36:04

, um, being above average,

36:06

the equipment manufacturing industry, you

36:09

know, from soup to nuts pays it's

36:11

, I , I don't want to misquote

36:13

this, but it pays about 30%

36:16

over the national average. So

36:18

the dialogue around the minimum wage conversation

36:21

is very important for a number

36:23

of reasons, but the

36:25

industry already pay off . At least the manufacturing

36:27

industry already pays above, above that. Well above

36:29

that. So, and we've been making that case in

36:31

the public and the public awareness efforts.

36:34

We definitely make that case when we're talking to folks

36:36

about why they need to get engaged with the industry.

36:39

Um, you know, we could probably spend all day talking

36:41

about , um, the public

36:43

awareness campaign that's being undertaken to

36:45

kind of recast manufacturing and

36:47

construction as technologically

36:50

advanced, as challenging as engaging

36:52

rather than, you know, the traditional manufacturing

36:54

job that is has sometimes.

36:57

And I, and I never thought this, but

36:59

I could see why some folks did is that, is

37:01

it , it's a dirty job. It's not, you know,

37:03

it's, it's so , um, and we're making inroads

37:05

there. Um, legislatively two

37:07

things I want to flag for listeners

37:10

, um, as well as for you Marie , and

37:12

Dariana, as I'm sure you're aware of

37:15

is that there is a renewed interest

37:17

in the apprenticeship program in terms

37:19

of modernizing it, the national apprenticeship

37:22

program that is run has not been updated

37:24

since it was first authorized in

37:27

the 1930s. I want to say, and

37:29

you can imagine how just dramatically

37:31

different the workforce landscape

37:34

and the skills are acquired , um, you

37:36

know, have changed since that time. So

37:38

there is a bipartisan effort going

37:40

on right now to reform the apprenticeship

37:42

program. The registered apprenticeship program

37:46

am when it comes to registered apprenticeships

37:48

, um , are in support of modernizing

37:50

the, the S the, the current system.

37:53

We would like to see more flexibility

37:55

for employers within that system.

37:58

We have a number of OEMs

38:00

that have attempted to, you know, launch

38:03

and register their apprenticeship programs

38:05

that deliver incredible results , um,

38:08

but have, have had any number of kind

38:10

of roadblocks when they go to register.

38:12

It's a very difficult process. And so

38:15

we're going to continue to push for

38:17

, um, you know, some middle

38:19

ground where employers have a little bit more flexibility

38:22

so that because we see the system that their

38:24

apprenticeship , um, the

38:26

apprenticeship platform, that whole

38:28

philosophy has worked, you know, for a

38:30

number of nations. Um, it it's

38:32

worked in the U S you know, so we want to

38:34

see it. We want to really see it take

38:37

off. Cause we see it would really benefit, not

38:39

just equipment manufacturing, but

38:41

construction as well. And then the other piece

38:43

is this focus on what

38:46

has happened to displace workers as a result

38:48

of COVID. And in terms of

38:51

Dariana mentioned the , uh, th th the

38:53

difficulty that the hospitality and leisure

38:56

industry are experiencing. So you have a

38:58

host of workforce from that, that

39:00

industry that are looking for retraining

39:03

and re-skilling opportunities. And that's

39:05

an, that's an awesome opportunity for

39:08

the equipment manufacturing industry in the construction

39:10

industry. And so Congress is working

39:12

at , uh , reauthorizing,

39:15

the federal job training program that is

39:17

up. So it's called the workforce innovation

39:19

opportunity act. We Ella

39:21

, again, another acronym got to love it. Um,

39:24

but to that end, if they're able to reauthorize

39:27

this at a funding level,

39:29

that will actually make a difference, then

39:32

we're in business, you know, in terms of

39:34

retraining rescaling , um,

39:36

and it could mean great things for the workforce

39:38

development efforts for a whole

39:40

new generation of Americans.

39:42

Honestly, the, the

39:45

thing that we continue to , to , to encounter

39:48

the roadblock that we continue to encounter

39:50

is just the funding level. There

39:52

just w we, we are trying to build

39:55

momentum to increase that

39:57

funding level to a point where it's actually

39:59

effective because to date,

40:02

you know , when you look at the federal pie,

40:04

the spending for workforce development,

40:07

adult retraining and jobs and

40:09

job rescaling has not really been

40:12

the priority that it needs to be. So,

40:15

yeah , unfortunately COVID

40:17

has kind of given us an

40:19

opportunity where we're able to

40:21

take that on. So just two things to flag

40:23

apprenticeships, and then , uh,

40:26

the we're , the WEOA reauthorization.

40:29

Um, so a lot going on

40:31

in the workforce arena, when it comes on the Hill,

40:34

That's fantastic. You actually, you're

40:36

, you're the , you talk about that and the

40:39

displacement COVID being bad

40:42

and displacing people from jobs

40:45

that may be a while

40:47

in coming back and being

40:49

able to retrain them to go

40:51

into something different. Yeah. And

40:54

I think he , if he tied that in with that

40:57

previous discussion we had with technology, you

40:59

know, for someone to say, Oh, I never

41:02

been on a piece of equipment before. I've never

41:04

done that. I can't, but being able

41:06

to come in and utilize technology

41:09

to all of a sudden, be able to get in the seat

41:11

of the piece of equipment and be able to operate

41:13

it or to get out on the job and realize

41:15

that it's not impossible. It's

41:18

just about that , uh, being

41:20

a trained to do that. So that is very

41:23

enlightening and encouraging

41:25

that , uh, on across all fields,

41:27

if there's ways to employ more people

41:30

and these people to , to

41:32

make more money. Well,

41:34

listen, this has been fantastic. And I

41:36

think we could keep going on here for

41:39

another, like I said, hours or days

41:41

on these types of topics that are

41:43

affecting so many of us , uh

41:46

, I , I just want to thank both of you for

41:48

joining us today. And

41:50

if you have anything else that you'd like to add here,

41:53

please do Dariana . Is there anything

41:55

else that you'd like to add to our

41:57

conversation?

41:58

I think what you mentioned about

42:01

Reese Kayleen on, on

42:03

also , uh , what Kate mentioned

42:05

that about rescaling and

42:07

also , um, how

42:10

pain , uh, workers

42:12

in the leisure and hospitality

42:15

sector to probably

42:17

enter in the construction industry,

42:20

I think is, is, is , uh, is

42:23

great that the government was more

42:26

the , you know, they say these policies

42:28

are great, but I think

42:31

ultimately I think

42:33

in the long-term , we're going

42:35

to need more than that for

42:37

, uh, to lower

42:40

costs , uh, building costs and industry

42:43

, uh, because I

42:45

think I see you, you know, you, you,

42:47

you know , only have the issues with

42:49

like , uh, wage inflation

42:52

because of you to the lack of skilled

42:54

labor, also known as

42:56

skilled labor is an issue , uh,

42:59

in the industry. And I think

43:01

that , um, by

43:03

it, as mobile-friendly immigration policies

43:06

are or friendly immigration

43:08

policies, I think we're definitely

43:11

could help their , the , the

43:13

sector to,

43:15

you know, to address this issues.

43:19

Um, we also going to see that

43:21

, um, uh , you know, although he's

43:23

going to, he's going

43:25

to keep tough on China. Uh,

43:28

I think , um, like

43:31

we're going to expect that

43:33

a less disruptive , uh , foreign

43:36

environment in general

43:38

would help , um, address

43:41

also issues. We home-building

43:44

, um, also rising

43:46

, uh, housing costs

43:49

, uh, in general. I think we also

43:51

have to look into that. I

43:54

mean, I , I don't know if you've seen, like recently

43:56

lumber prices, Reesh like

43:59

Brecker highs recently. And

44:02

, uh, and I think this is adding to

44:04

home builders and

44:07

on is probably limit

44:10

homebuilding activity this year. Uh,

44:12

we also have seen mortgage rates

44:14

, uh , rice in, in recent weeks.

44:17

And , uh , as the [inaudible]

44:19

continues to recover , uh,

44:22

we are going to see efforts from

44:24

the federal reserve,

44:27

the fed to

44:29

, to be less inclined to,

44:31

to, to buy mortgage spot securities,

44:34

to maintain these mortgage rates at

44:36

these frequent loads. So I think we

44:38

agreed to , um, we have to

44:40

bear these costs Asia's in mind

44:43

. And , uh, but I think is

44:45

quite , uh , good to see

44:48

that the government, the U S government has,

44:50

is been putting all these, you

44:52

know, policies and measures in

44:54

place. I'd hopefully I think

44:56

, uh, by the end of this year , uh , we

44:58

get , uh , uh, infrastructure and bail pass

45:01

, uh, and that definitely going

45:03

to boost not only the

45:05

construction sector, but also

45:07

the technology , um, the, the

45:10

, uh , manufacturing sectors.

45:12

Yeah. I think that housing supply

45:15

and demand is certainly been skewed with the

45:17

COVID, you know , people now wanting

45:19

to a lot of move rural

45:21

and get out of the city. Yeah.

45:24

Housing market really across the

45:26

entire country has been very strong.

45:28

And as you said, with record

45:31

low rates, you know, all those things

45:33

have played together to make a strong market

45:36

and, and , uh , appears

45:38

to be, it's going to continue for much longer

45:40

, uh, you know, Kate,

45:42

anything else you'd like to add to

45:44

our conversation today?

45:46

I , you know, I just want to say that I've enjoyed this

45:48

conversation so much. Dariana,

45:50

it's been a pleasure, Marie, a pleasure.

45:52

Thank you for having me. I

45:54

hope all of our hopes and dreams come true

45:57

when it comes to it .

46:00

And that's that optimistic attitude you have

46:02

Kate, and we love that. And that's , uh,

46:04

what keeps everybody happy? Uh , okay.

46:06

Well, thank both of you for joining us.

46:09

Uh, I would like to thank all our listeners for participating,

46:12

and hopefully this has been an enjoyable

46:14

conversation for you today, and we look

46:16

forward to you participating in the next

46:18

one.

46:19

Thank you . [inaudible]

46:26

.