Concrete Contractor connected with Michael McGowan, the CEO and Region Head for Hilti North America, during World of Concrete 2026.
McGowan shared their insight into what has been ailing concrete contractors, what manufacturers are doing to ease those challenges, their outlook for the year, and more.
Q. What has been the biggest challenge for concrete contractors?
Michael McGowan and Jonathan Kozlowski at the Hilti Inc. booth during World of Concrete 2026
Number two, external factors that they're facing are things that you're probably extremely aware of. There's not enough young people going into the trades and there's a lot of people that are leaving the trades/retiring from these jobs. What you have is limited access to skilled labor working in the trades today. For a lot of contractors, I think it's hard to find people to execute the work.
Another external factor that I think is impacting them is material costs. We see the impact of tariffs accelerating the price of materials.
When you put all that together, you have a challenge in the middle market where there's not a lot of work so people are being really competitive in pricing the jobs so that they can win them. But you have high labor costs because of limited access to labor, and then you have high material costs, so profit margins get really squeezed. Those are the big challenges facing the industry right now.
Q. How do you think the OEMs will address this in 2026?
The way we're helping is from a technology standpoint. We develop really innovative solutions that help eliminate steps in the applications that they perform with the steps that remain. We try to speed up the steps so that they're faster, and then also make them easier and simplified, so that [contractors] can offload many of these applications to a lower skilled worker, and allow more skilled workers to do the more complex tasks. We're leveraging technology to make them more productive so that they can get more work done with less resources.
We've always had a mindset of developing products that last longer if you don't have to rebuy a product. Because, if it doesn't break down frequently, then that reduces your material costs.
And then the third thing is on the tool side of the business. We've invested heavily in a repair network that fixes customers tools the same day we get them. By being able to fix a tool in the same day, a customer isn't really required to go buy another tool to keep working. It might be that they have to reallocate a few people to a different task, but we can get the tool back to them in such a fast turnaround time. That also reduces the amount of material that they buy or the amount of tools that they have to buy.
Q. What do you think a tool manufacturer's role is in getting that skilled worker back into the concrete industry? How do you change that mentality for the next generation?
I always say that the people that work in construction, they're the heroes in our society that nobody recognizes, but they should. If it wasn't for the people that did the hard, grueling work every single day, we wouldn't have the ability to live in the amazing communities that we live in, and all the infrastructure that we depend on to live our lives.
Having worked construction in my past, I understand what it's like: you get home at the end of the day, you're exhausted and you're just trying to recharge the battery so you can actually go to work the next day. What my vision is for our company is that we make the task easier in the moment, so that you're less fatigued at the end of the day. When you're less fatigued at the end of the day, you can do other things besides just get ready for the next day's effort.
We believe that while we can make the task easier in the moment, we also think that we can protect the worker, so that the wear and tear is not elongated and shortens the number of years that people are able to work in the trade. What we're doing is we're trying to bring more technology to the trade so it's even more appealing to the young people that are considering what they're going to do with their lives.
Everybody's growing up now with smartphones and technology, and so we're using a lot of that same interfaces into the technology. We're bringing human augmentation and taking highly repetitive tasks that a worker would normally do and reducing the wear and tear on the body by exoskeletons or robots that will actually take the highly repetitive tasks that are dangerous and give them to a robot where somebody would actually just use a controller and be removed from the danger of the task. Those are the things that we're working on.
Just helping to tell the story in the industry. There's a lot of people that, for a long time in this country, we almost vilified young people that didn't go to college, and told them that they couldn't be successful unless they got a college degree. So, everybody started to go to college. Some most of the most successful people that I know, they actually are in construction, making really good money, have the vacation homes, have the fishing boats, and all that stuff. The narrative around why you need to go to college versus going to trades is maybe not accurate.
We also see that a lot of young people are coming out of college today with massive debt. They can't even find a career that they can pay that debt off in a reasonable time frame. One of the things that we're trying to do is help tell that story where we visit high schools. We support vocational training programs. We donate our tools to actually make it easier for those schools to educate and train the workforce of tomorrow.
Q. What is your outlook and forecast for 2026?
In my role, you have to be optimistic. I'm very optimistic. I think that one thing that we know for sure is that data centers are going to continue to go strong for the foreseeable future. There is a resurgence of manufacturing, especially around chip production and pharmaceutical production. That's going to be hot. Those mega projects are going to keep happening. Now, those mega projects also, they demand an enormous amount of energy, so I believe that there will be a lot of investment into construction projects related to energy and energy transmission.
Q. You mentioned earlier that the “middle market” was stagnant? What's preventing that market right now?
I think you have a number of factors. One, access to financing has historically been very challenging for the last couple of years. When you are able to access it, the rates have been extremely high. You have the high material costs, and then low shortage of labor so labor costs are going up.
I think we'll start to see interest rates drop. We know that there's a planned change as a federal chairman. The signaling from the administration is probably somebody that's more favorable to lower interest rates. What I believe is that that eliminates one of the barriers for private money to jump in and develop the more traditional type of construction.
It doesn't mean that the material costs and labor costs problem won't still be there, but at some moment in time, the cost to borrow and for the person who ultimately buys that high rise condominium gets to a point where it becomes attractive. We have a housing shortage right now so it's a moment in time it has to flip. I believe that that could be as early as second half of this year.
Q. What innovation are you most excited about?
I'm excited for what we're launching this year. Everybody is trying to build a cordless platform that would allow you to eliminate the needs for cords on a project. Cords can be a drain on productivity. You have to roll them out. You have to move them throughout the day. You have to roll them up at the end of the day. Oftentimes they get damaged. They're also a tripping hazard on a project. All the manufacturers are trying to find a way to make applications more cordless.
Five years ago that was really challenging with the technology that existed. But our Nuron Power Up platform can now take the most grueling applications on a jobsite and enable a customer to do them cordless with the same level of performance that they would get out of a corded tool or a gasoline engine. We still maintain our commitment to corded tools and gasoline engines because there are applications that will still require that.
A cordless portfolio is really good if you're doing heavy work for a shorter duration of time, but if you have large production that you have to go all day long, oftentimes gasoline and corded is still the best option. What I'm excited about is that with this battery platform, we move into the heavy applications.
Q. What’s the biggest difference between the battery-powered light equipment and tools 5 years ago versus what we’re seeing in 2026?
The technology has just gotten better. The batteries have longer run time. We're able to transmit more energy from the battery to the tool. And the technology of charging the batteries has gotten a lot better. All manufacturers manufacture an ability to assess the current level of charge in the battery. What we've actually now developed is state of health. By squeezing the button, our battery does diagnostics on itself to tell you how healthy the cells are.
Traditionally, when you would check a battery, it would just say, it's full. But if half the cells were bad, your battery is just telling you that the cells that were still good are fully charged. You would make the assumption and work with that battery thinking you had a full charge. What our battery now does is it actually runs a state of health, and says two of the cells are actually bad and “this” battery needs to be replaced.
Q. Is there something not yet cordless that you wish were battery powered? What’s on your wish list?
We have a number of products in development that that I can't really share with you. We're really excited, because this battery platform that we have, we're able to take on these heavier duty applications. What's really cool is it is the same battery connection that we use on our small screw guns and our light duty tools – that our battery would fit on a screw gun to our largest breaker and gas saw. And it's the same charger. Same connection. It's just a different size of the cells inside the battery. So that's super cool. What we're able to do with this technology is so now we're able to tackle really big applications that, quite frankly, nobody else can.
What do I hope for? I hope that we're able to do even larger pieces of equipment, like stuff that today you would you have to have a gas engine or you have to have a propane tank to be able to run. Right now, I don't think that technology is there, but we'll figure it out.
