In construction, we obsess over building things that last. The irony is how few of us apply that same standard to the business itself.
That's not a criticism. It's the story behind a wave the headlines are now calling the "silver tsunami," and it's a wake-up call I think every family-owned contractor needs to hear.
Over the next decade, an estimated 2.3 to 3 million baby boomer-owned businesses in the U.S. are expected to change hands and construction is one of the industries most heavily concentrated with owners near retirement age.
The catch, according to Forbes: only about half of them have a succession plan.
And here's what I've learned advising these families for years, something the headlines won't tell you: transferring the assets is the easy part. The real risk is a business that can't transfer leadership, responsibility, and trust to the next generation.
What the Headlines Are
Saying Forbes, Fox Business and industry analysts at JLL are sounding the same alarm: a demographic wave of retiring owners is arriving now, and construction sits right in its path. The message is blunt.Succession isn't a future problem for contractors. It's a present one, and most firms aren't ready.
More than half of privately held U.S. businesses now have owners over 55. The transition wave isn't approaching. It's already breaking, and the firms that wait to prepare are the ones that lose the most.The coverage surfaces something critical: the contractors who navigate transition successfully aren't just protecting valuation or minimizing tax. They're preparing people, building governance, and making the company outlast the founder.
Read The Article
Three Key Takeaway
- The transition wave is already here - With more than half of construction owners past 55, this isn't a 20-year horizon. Firms without a plan are already operating at a disadvantage, and building a real transition takes far longer than most owners expect.
- Most owners have no plan, and construction is especially exposed - Only about half of retiring owners have a formal succession plan. In construction the risk runs deeper: analysts warn the industry's looming leadership shortage may prove even harder to solve than its well-known labor shortage, because too few firms develop the next tier of leaders before the retirements hit.
- Unprepared transitions destroy what took decades to build - Only about 30% of family-owned construction firms make it past the second generation, and just 20% survive into the third. Roughly 70% of family business transfers fail outright. The firms that beat those odds are the ones that had the hard conversations early, before the pressure hit.
Here's What This Means for Family Businesses
If you run a family-owned contractor, this moment matters to you directly.
You have a choice: intentionally prepare your next generation for ownership and leadership, or leave it to chance and a buyer who may never show up. In my experience, the construction firms that thrive through transition are the ones that start now, not when retirement is already on the calendar.
In practice, that means clarity on your vision for the business and the family, explicit conversations about values, decision-making, and accountability, and systems that don't collapse the day you step off the job site. Ultimately, it means addressing the hard questions before you're forced to.
I Recently Hosted This Conversation
A working session on how construction families move from surviving one generation to building an enterprise that lasts across many.
This one was a structured conversation between five specialists, each covering a different force that quietly erodes even successful construction companies.
Speakers included:
- Emrich Stellar, III - Stellar Advisors
- Roey Diefendorf - More Than Money 360 (MTM360)
- Jerry Aliberti - Pro-Accel
- Anthony DiTucci - Livingston Associates
The conversation wasn't really about money. It was about communication, clarity and intentional succession. If you missed it, the recording is available.
The Snapshot
Quick Assessment
If you want a quick assessment of where your family business stands on succession readiness, this Snapshot tool gives you clarity on the gaps and what to address first.
The White Paper
A grounded, practical walk-through of the challenges construction families face during ownership and leadership transitions, written for owners and their advisors.
New
The Mini CourseSuccession Fundamentals
A free, self-paced mini course that introduces the Family Business Flywheel, the core building blocks of a family business that can grow without everything depending on you. Four short videos help you see where you are today and what to strengthen next.
Podcast Episode
What Makes a Family Business Last Across Generations
This episode with Domenic Cortese of Cortese Construction Services Corp digs into what separates the families that endure across generations from the ones that don't, and the habits you can start building today. Listen Now
The Bottom Line
Millions of businesses are about to change hands and half have no plan. To me, that's not a statistic. It's families, jobs, legacies, and the futures of the people who depend on you. In my experience, the firms that navigate this well aren't the biggest or the most profitable. They're the ones that prepared intentionally.
If succession is on your radar, whether you're thinking five years ahead or fifty, the time to start is now.
Committed to your success,
Michael Palumbos
P.S. The families that succeed in wealth transfers share one thing in common: they started preparing years in advance. They didn't wait. If you're thinking about this now, you're already ahead.
