The construction industry faces persistent challenges, including rising materials costs, an unpredictable supply chain and ongoing labor shortages. And small and midsize businesses—SMBs—in construction are navigating industry shifts such as the move towards smart cities, sustainability initiatives and new regulations. Despite these hurdles, SMBs in construction and contracting are underutilizing technology that could help, according to Verizon Business’ sixth annual State of Small Business Survey. This survey, conducted in collaboration with Morning Consult, gathered responses from 600 small and midsize businesses. While the findings weren’t limited to construction alone, insights related to AI adoption highlight trends that are especially relevant to the construction and contracting space.
AI FOR PROJECT MANAGEMENT AND SCHEDULING
One of the most immediate and tangible benefits of AI in construction is smarter project management. AI-powered platforms can analyze vast amounts of data in real-time to optimize schedules based on variables such as weather forecasts, material delivery timelines, labor availability and even traffic patterns.
With today’s ever-changing macroeconomic environment, it’s a necessity within the industry to predict disruptions and have contingency plans in place. AI can help project managers reallocate employees in the field, adjust timelines, and even simulate different scenarios to find the most efficient path forward. This not only helps to reduce downtime but also helps improve budget adherence and client satisfaction. For SMBs juggling multiple projects, AI can serve as a digital superintendent, helping keep everything on track and under control.
PREVENTING DOWNTIME BEFORE IT HAPPENS
Equipment failure is a costly disruption, creating a chain reaction of negative events, increased repair costs, lost productivity and project delays. AI-enabled predictive maintenance tools are changing the game by using sensors, machine learning and historical data to anticipate when machinery is likely to fail.
Instead of relying on fixed maintenance schedules or waiting for something to break, SMBs can now service equipment proactively. AI can detect subtle changes in vibration, temperature or performance that may signal an impending issue. This allows teams to intervene early, potentially preventing breakdowns and extending the lifespan of expensive assets like cranes, bulldozers and concrete mixers.
For SMBs operating on tight margins, this kind of foresight can be a game-changer. It can reduce emergency repair costs and downtime and help to keep critical equipment ready when needed.
ENHANCING SAFETY WITH AI-POWERED MONITORING
Safety is paramount on construction sites and—as the construction SMB industry survey respondents report 71% of its workers must work in person—AI is emerging as a powerful ally in reducing risk. Through computer vision systems, AI can monitor jobsites in real time, identifying unsafe behaviors such as workers not wearing PPE, entering restricted zones or operating machinery improperly.
Environmental sensors powered by AI can also track air quality, noise levels and structural integrity. If a scaffold begins to shift or a trench shows signs of collapse, AI can trigger immediate alerts, allowing for swift intervention. These tools not only help prevent accidents but also support compliance with OSHA regulations and can reduce liability.
PROTECTING THE DIGITAL JOBSITE
As construction firms increasingly rely on digital tools, from cloud-based project management platforms to IoT-enabled equipment, they become more vulnerable to cyber threats. In Verizon Business’ 2025 Data Breach Investigations Report, 30% of breaches were linked to third-party involvement, twice as much as the previous year, and driven in part by vulnerability exploitation and business interruptions.
AI-driven cybersecurity solutions can offer a robust defense. These systems can detect unusual network activity, block phishing attempts and automatically respond to breaches in near-real time. If an unauthorized user tries to access sensitive blueprints or financial data, AI can help isolate the threat and alert IT teams instantly.
A single breach can halt operations, damage reputations and result in costly legal consequences. AI can help firms stay one step ahead of cybercriminals, enhancing the robustness of their digital infrastructure.
THE AI ADOPTION GAP IN CONSTRUCTION
Despite their optimism and operational focus, small to midsize construction companies are lagging in one key area: AI adoption. Only 33% of SMBs in construction and contracting report using AI tools, down four percentage points from August 2024. Given AI’s potential to transform operations, this is a missed opportunity.
The remaining reluctance to adopt AI may stem from several factors. Some business owners may perceive AI as a high-cost investment with unclear ROI, while others may believe it’s too complex to integrate into traditional construction workflows. There’s also a lingering misconception that AI is only relevant to tech-heavy industries like finance or healthcare. But the reality is quite the opposite: AI is increasingly accessible, with scalable solutions tailored specifically for construction firms of all sizes. As more user-friendly platforms emerge, the barrier to entry is lower than ever.
WHY NOW IS THE TIME TO INVEST IN AI
The time to invest in AI is now, as it offers SMBs in construction and contracting a way to become more agile, efficient and resilient. It’s not about replacing workers. It’s about empowering them with better tools.
Verizon Business’ 2025 State of Small Business Survey shows that while construction companies are optimistic, they’re also pragmatic. They’re watching supply chains, monitoring inflation and staying alert to geopolitical shifts. But optimism alone won’t future-proof a business. Strategic investment in technology, especially AI, can make the difference between surviving and thriving.
STAYING LEAN. STAYING COMPETITIVE.
The construction industry is experiencing strong demand, fueled by infrastructure initiatives and private sector growth. But with that demand comes pressure to deliver faster, safer and more sustainably.
AI can help SMBs meet these expectations without overextending their resources. By automating routine tasks, improving decision-making and enhancing safety, AI allows companies to do more with less. And in an industry where margins are often razor thin, that efficiency can be the key to long-term success.
SEE ALSO: DIFFERENT AI USES PRESENT SIMILAR BENEFITS FOR LARGE AND SMALL CONSTRUCTION FIRMS
