Smart cities and the well-being of construction workers

28 August 2019

Smart cities and the well being of construction workers Smart cities could mean better and healthier lives in emerging economies — both for inhabitants and the workers who build them. In our latest edition of Building Sight, we look at the increasing focus on wellbeing from a construction perspective such as how it could impact on the built environments we create, how technology is improving occupational health and the risk of psychological injury due to stress.

Over the last decade, our understanding of what makes a “smart city” has shifted. It’s not so much about the technology in the city, as using technology and data to improve decision-making and delivering a better quality of life.

There are three layers to a smart city, according to the McKinsey Global Institute’s (MGI) 2018 report Smart Cities: Digital solutions for a more liveable future, which studied 50 cities around the world.

The first layer is the physical infrastructure, the second is the technology — mobile phones, apps, sensors, and Wi-Fi — and the third is the data and how it is used.

The application of smart city ideas in emerging economies offers huge opportunities to improve the lives of people living and working in those cities.

Beyond the basic needs of housing, social infrastructure, and utilities, smart cities could bring easier access to sanitation, transportation, public services, and information.

They also lead to reduced crime levels, cleaner air, and the opportunity to live healthier lifestyles.

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Cities with a smart agenda are also more likely to attract overseas investment.

In turn, this could help raise safety and welfare standards for those constructing and maintaining them, as lenders and other project stakeholders may insist on project management standards that are above average for the territory.

While higher-income cities have progressed further toward smartness, the need to improve cities in developing economies is urgent.

In Brazil, more than 87% of the population live in urban areas. In India, 33% of the population lives in cities, a figure set to rise to 50% by 2030.

With its established urban population, Brazil’s challenge is to improve its existing cities.

Several Brazilian cities are working to advance the smart city agenda, among them São Paulo, Curitiba, Vitória, Belo Horizonte, and Rio de Janeiro, but they still lag behind the world’s leading smart cities such as Singapore, Seoul, and New York on almost every count.

The Journey to Smart

“Brazil is at the start of its journey toward smart cities,” says Andre Dabus, director of Marsh JLT Specialty’s infrastructure team in Brazil.

Private investment will be vital to this journey, he adds, with a raft of public-private deals to cover everything from intelligent street lighting to sanitation and education.

São Paulo, cited by MGI and others as Brazil’s most advanced smart city, is still struggling with extreme budget constraints.

One of its first smart city programs, Descomplica Digital, aimed to digitalize all interactions between citizens and the municipality. But, first, it had to upgrade the hardware used by the city’s civil servants, which could only be done with Cisco Systems and others donating computers.

One of the biggest challenges any city faces before it can become smart is to have functioning infrastructure in place. Though some developed cities suffer from creaking infrastructure.

“There’s a new infrastructure gap emerging, which is the fact that Latin American cities and their infrastructure are not ready for the digitization required to become smart cities,” says Joao Buzio, construction leader for Marsh JLT Specialty in Latin America and the Caribbean.

The Indian government has an ambitious smart city program, committing in 2015 to investing in 100 smart cities over five years.

However, progress has been slow. In January 2019, the government admitted that just $510 million of $2.3 billion allocated had been spent on smart cities projects.

“Around five years ago, the plan was to do everything in smart cities with private money,” explains Nisheeth Srivastava, construction leader for Marsh JLT Specialty.

“Eventually, people realized that it was going to be tough to persuade the private sector to build the basic infrastructure. Now the plan is to improve basic infrastructure to a level where it is attractive to foreign investment,” he adds. India’s smart city agenda is now more attractive, integrated into a plan for five huge industrial corridors linking the country’s biggest cities.

These include the Delhi-Mumbai Industrial Corridor, the Chennai-Bangalore Industrial Corridor, and the Bangalore-Mumbai Economic Corridor. This approach is attracting overseas interest, with Japan a keen participant.

Smart City, Smart Contractor?

While tomorrow’s vision of a smart city delivers healthier and happier inhabitants, it cannot be presumed that the lives of those building and updating the city’s infrastructure will also be better.

In emerging economies, construction workers are often uneducated or poorly educated, whose welfare and rights are often overlooked.

However, the involvement of overseas banks and other funders can positively affect safety standards and worker health.

In Brazil, major infrastructure projects already adhere to international standards, says Dabus. Brazil is enjoying its third wave of public-private deals, with the latest one seeing the involvement of overseas players.

“In the infrastructure sector we already have international funders and agencies involved. International companies are very strict about safety, but I don’t see that it is a huge problem for Brazilian companies to meet those standards,” says Dabus, although he adds, “It may be a different story for small construction sites.”

For Planet Smart City, which is developing the smart cities of Laguna (see box) and Natal in Brazil, and hoping to create smart districts within some of India’s large cities, it is important that construction workers are competent.

“We want the highest levels of quality and safety,” says Daniele Russolillo, deputy chief executive officer of Planet Smart City, an English company headquartered in London. “If we want to build a sustainable place, we want to start with the people working in it.”

In Brazil, Planet Smart City is carrying out the construction work itself, employing local people. “We have 300 workers, all trained by us to high levels of safety,” says Russolillo.

In India, Planet Smart City partners only with local developers who share the same values and the same standards for safety and quality to be given to local contractors, says Russolillo.

Alongside the basic obligation of a company to protect and care for its workforce, there are various reasons why safe, skilled workers are important for Planet Smart City developments.

First, construction sites often serve as a shop window for would-be inhabitants, with 24-7 camera footage shown online and visits to sites from potential house buyers meaning that the reputational exposures of a company are an ever-increasing concern.

Second, the company promises to develop quickly to provide a better internal rate of return for its investors, and poor health, safety, and well-being policies may cause unnecessary delays to project delivery.

In India, Srivastava doesn’t see overseas investors or developers as a catalyst for welfare improvements among the country’s construction workers. Instead there is pressure from the government, he says.

“Over the last few years there have been a lot of labor reforms, with the introduction of minimum wages and certain health and safety standards for the laboring class,” adds Srivastava.

The Modi government is currently working to introduce more laws concerning wages, industrial relations, social security, welfare, occupational safety, health, and working conditions.

These basic standards need to be in place before contractors consider using technology to improve efficiency or safety. Where workers are cheap and expendable, the motivation to invest in new solutions isn’t there.

But, as smart cities develop, those providing construction and maintenance services must develop, too, to be able to communicate and work with smart systems.

In the future, automation and the use of remotely-controlled vehicles, such as drones, should reduce the potential safety risks to humans further.

Though Brazil’s urban population is well-established and India’s is rapidly growing, both face similar challenges: How best to set up smart cities to attract private funding for future waves of development.

There is already an appetite from overseas investors, developers, and technology firms to get involved. And over the next few years we should see an increasing number of public-private deals that will allow them to do that.

In turn, it is expected that the safety and welfare of construction workers will start to improve in line with the standards and technical skills of the companies involved.

An Affordable Smart City?

In Northeast Brazil, Planet Smart City is building a brand-new city called Smart City Laguna. Located in São Gonçalo do Amarante, in the state of Ceará and 55 km from Fortaleza, its creators claim this will be the world’s first affordable smart city.

"We are not interested in building smart cities for rich people,” says Planet Smart City’s Deputy CEO Daniele Russolillo.

“We want to deliver homes for low-income families, using social innovation.”

Laguna will provide homes for 25,000 people on its 330 hectares. Mostly residential, it will also have small amounts of retail and industrial property, as well as schools and health care. The house prices at Laguna are aimed at low- and middle-income families, with a 56m2 property costing from R$96,000 (£20,000).

As for what makes Laguna “smart,” the city will boast more than 40 smart solutions, says the developer, including pavements that reduce heat, solar energy, and a “Planet App”, which allows residents to do a host of things from monitoring their monthly energy bills, to booking free public spaces for parties and community events, to organizing ride shares with neighbors.

An “innovation hub” that opened early in the development phase offers a library, free English and entrepreneurship courses, movies, and crafts. “A city is a place for people. We are very human-centric,” says Russolillo.

People are already living in Laguna. Planet Smart City completed the first phase of Laguna in January 2018, with the final phase to be delivered by 2021.

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  • Richard GurneyRichard Gurney

    Richard is the Global Head of the Construction Practice at Marsh JLT Specialty.

    Richard joined Marsh in April 2019 following the acquisition of JLT where he had worked since 2002. Formerly Global Head of Construction at JLT Specialty and also Head of Claims, Richard has worked in the London insurance market for 29 years. He accumulated extensive experience working with many of the group’s major Construction clients and on some of the world’s largest projects. 

    Past responsibilities also include being a non-executive director on the board of JLT India and overall responsibility for the wholly owned JLT claims consultancy, Echelon.

    If you would like to talk about any of the issues raised in this article, please contact Richard Gurney, Global head of construction on +44 (0)203 394 0387.

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