Industry division over artificial intelligence integration in construction industry
In a recent report titled "Transition then Transformation - AI in construction disputes," published by law firm CMS on July 8, 2025, the current state and future trends of AI adoption in the construction and engineering sector have been highlighted. The study, based on a survey of over 50 senior legal and contract professionals worldwide, reveals a growing divide between businesses actively embracing artificial intelligence (AI) and those struggling to keep up.
The report underscores the need for training employees on how to use AI technologies within their business, as emphasized by Adrian Bell, co-head of CMS's infrastructure, construction, and energy disputes group. According to the findings, more than half of the respondents work for organizations with revenue exceeding USD 1 billion, and more than 62% expect external counsel to be using AI tools.
AI is already being used in transactional work across the sector, most commonly in contract review, communication analysis, and contract drafting. However, challenges remain, particularly in ensuring the robustness of robotic systems in harsh construction environments and their seamless collaboration with human workers.
In terms of dispute management, arbitration, and mediation, the report suggests that while AI applications are not yet widespread, the complex and data-intensive nature of disputes in construction projects makes AI an attractive solution for faster evidence review, predictive analytics for dispute outcomes, and more objective mediation processes.
Looking ahead, future trends indicate that AI adoption will continue to accelerate, becoming deeply embedded in all facets of construction and engineering. The focus will be on enhancing collaboration between humans and intelligent systems, improving safety and efficiency, and enabling better decision making through data insights. For dispute resolution specifically, AI-enabled platforms and smart contracts could automate and streamline arbitration and mediation, reducing delays and improving fairness and transparency.
However, the report also flags concerns around data or privacy breaches, with 68% of respondents expressing such concerns. Other risks such as inadequate governance, lack of transparency in AI processing, and unauthorized AI use were also identified.
In conclusion, the construction and engineering sector is witnessing rapid integration of advanced AI technologies, particularly in tasks such as construction management, robotics, and data analytics. Despite challenges, AI-enabled robotics and autonomous systems are quickly becoming integral to construction operations. The industry is investing heavily in AI and related technologies, with a large percentage of tech budgets allocated to AI for 2025 onward. The report reveals a growing divide between businesses actively embracing AI and those struggling to keep up, underscoring the importance of strategic partnerships, cross-sector collaboration, and continuous workforce upskilling for successful AI integration.
The report indicates that AI is increasingly being utilized in the business sector, specifically in construction and engineering, where it's already being applied in transactional work such as contract review, communication analysis, and contract drafting. Moving forward, the industry is investing significantly in AI and related technologies, with a focus on enhancing human- AI collaboration, improving safety and efficiency, and making better decisions through data insights.
In terms of finance, the report suggests that AI-enabled platforms and smart contracts could automate and streamline arbitration and mediation, potentially reducing delays and improving fairness and transparency. Nevertheless, concerns around data breaches and privacy, inadequate governance, lack of transparency in AI processing, and unauthorized AI use have been identified, which need to be addressed to ensure smooth adoption.
