European construction sector observatory

The number of enterprises in the broad construction sector in Austria totalled 74,614 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 46.5% of the total firms. Overall, the number of enterprises in the broad construction sector increased by 11.2% between 2010 and 2016, mostly driven by the 11.5% growth in real estate activities, followed by 11.3% in the narrow construction and 11.2% in architectural and engineering activities.

Production in construction of buildings experienced a 5.9% increase between 2010 and 2013, followed by a 4.5% drop by 2016, however a 1.2% increment is recorded over the period of 2010-2016. Similarly, production in civil engineering rose up by 14.4% in 2014, which was the highest since 2010, followed by a slight decrease of 3.1% in 2016 keeping a 10.8% increase since 2010 (Figure 2).

The total added value of the broad construction sector amounted to EUR 33.9 billion in 2016², with the narrow construction subsector contributing to 48.8% of the total added value³, followed by real estate activities (28.3%), manufacturing (12.2%) and architectural and engineering activities (10.7%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 17.0% in 2014, slightly above the EU-28 average of 16.9%, with real estate activities having the largest contribution (8.7%) (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Belgium totalled 186,454 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 60.3% of the total firms, followed by 23.1% of real estate activities. The number of enterprises in the broad construction sector has increased by 21.4% during the period 2010-2016, mainly led by the real estate sub-sector, which has doubled the number of companies. Production in construction of buildings dropped by 1.8% between 2010 and 2016, the largest decline among all sub-sectors, while the construction sub-sector decreased only by 0.8% over the same period of time. Conversely, production in civil engineering experienced a 10% growth until 2012 and it has been decreasing ever since, however it overall rose up by 2.7% between 2010 and 2016.

The total value added of the broad construction sector amounted to EUR 30.4 billion in 2016², with the construction sub-sector contributing to 57.1% of the total³ (EUR 17.4 billion), followed by real estate activities (EUR 5.9 billion, i.e. 19.5% of the total), manufacturing (EUR 4.0 billion, i.e. 13.3% of the total) and architectural and engineering activities (EUR 3.1 billion, 10.1%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 14.4% in 2014, slightly below the EU-28 average of 16.9%, with the real estate sub-sector having the largest contribution (Figure 4).

• Country fact sheet

In 2016¹, there were 52,057 enterprises operating in the broad construction sector in Bulgaria, with the construction and the real estate sub-sectors accounting for 37.7% and 40.0% of the total, respectively (Figure 1). The number of firms in the broad construction sector increased by 2.6% since 2010 (50,714), with real estate activities experiencing the greatest increase of 16.4%. Conversely, the number of enterprises in a narrow construction sector decreased by 7.2%. Production in construction dropped by 17.3% over 2010-2016, with a peak in 2015 due to the rapid consumption of EU funds and a drop in 2016 as these were exhausted² (Figure 2).

Additionally, production in construction of buildings and production in civil engineering dropped by 21.2% and 12.4% respectively on over the same period.

The total added value of the broad construction sector³ amounted to EUR 2.6 billion in 2016⁴, with the construction sub-sector accounting for 55.0% of the total (EUR 1.4 billion), followed by real estate activities (19.5%), manufacturing (15.5%) and architectural and engineering activities (10.1%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 14.4% in 2014, which is slightly lower than the EU-28 average of 16.9%. The real estate sub-sector constitutes the largest contribution (Figure 4).

• Country fact sheet

In 2016¹, there were 31,146 enterprises operating in the broad construction sector in Croatia, with the construction sub-sector (NACE F) accounting for 57.6% of the total number of firms (Figure 1).

Compared to 2010, the number of firms operating in the broad construction sector decreased by 20.4%, with the real estate sub-sector experiencing the greatest drop (-30.2%.), followed by construction (-27.3%) and manufacturing (-11.2%). Conversely, the number of enterprises in architectural and engineering activities increased by 19.0% during the same period. Production in construction dropped significantly between 2010 and 2015, but showed signs of improvements in 2016², as reflected in Figure 2. In general terms, the volume index of production in construction fell by 30.1% since 2010. This decline was led by the construction buildings, which decreased by 33.6%, whereas production of civil engineering decreased by 26.7%.

The total added value³ of the broad construction sector amounted to EUR 3.2 billion in 2016⁴ with the construction sub-sector accounting for 55.2% of the total (EUR 1.8 billion), followed by manufacturing (18.7%) architectural and engineering activities (13.7%) and real estate activities (12.7%) (Figure 3). The share of gross value added of the broad construction sector in GDP reached 16.0% in 2014, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Cyprus totalled 11,994 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 66.4% of the total firms. Overall, the number of enterprises in the broad construction sector decreased by 12.3% from 2010 to 2016. Company growth has been positive in two of the four sub-sectors from 2010 to 2016, namely in engineering activities and related technical consultancy as well as in real estate activities which grew respectively by 11.6% and 16.5%. On the other hand, the construction and manufacturing sub-sector saw a decrease by respectively 17.1% and 11.3%. Despite the overall decrease, both sectors have been following an upward path in recent years. In line with the drop in the number of companies, production has decreased dramatically from 2010 to 2016, by 47%. However, since 2014, production has picked up again (Figure 2).

The total added value of the broad construction sector amounted to EUR 777.6 million in 2016² with the construction sub-sector contributing to 68.7% of the total³ (EUR 534.6 million), followed by manufacturing contributing to 16.1% of the total, real estate activities with 7.8%, and architectural and engineering activities with 7.3% (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 13.4% in 2014, with real estate activities having the largest contribution (Figure 4). This is below the EU-28 average, which stood at 16.9% in 2016.

• Country fact sheet

The number of enterprises in the broad construction sector of the Czech Republic totalled 285,610 in 2016¹, with the construction sub-sector accounting for 58.9% of the total (Figure 1). Overall, the number of enterprises in the broad construction sector increased slightly between 2010 and 2016 (+0.4%), with real estate activities reporting the largest increment (+10.3%), while the number of companies in narrow construction declined by 3.3%. Production in construction dropped by 16.8% over 2010-2013, subsequently recovering until 2015. However, it fell again in 2016, following the exhaustion of EU funds in 2015, being 12.7% lower than 2010 (Figure 2). Specifically, production in construction of buildings declined by 7.5% over 2010-2016, while production in civil engineering declined by 22.7% over the same period.

In 2016², the total added value of the broad construction sector was EUR 13.2 billion (Figure 3). The narrow construction sub-sector contributed to 46.7% of the total, followed by real estate activities, manufacturing and architectural and engineering activities. The share of gross value added³ of the broad construction sector in the GDP reached 15.3% in 2013⁴, slightly below the EU28 average of 16.9%, with real estate having the largest share (Figure 4).

• Country fact sheet

In 2016¹, there were 70,120 enterprises in the broad construction sector in Denmark, with the construction sub-sector accounting for 47.7% of the total (Figure 1). The number of firms in the broad construction sector has increased by 10.9% since 2010, with architectural and engineering activities experiencing the greatest growth (+16.8%), followed by real estate activities (+16.6%). At the same time, the number of enterprises in manufacturing declined by 1.2%.

Production in the construction of buildings has been recovering since 2010, exceeding the 2010 level by 17.2% in 2016 (Figure 2). Similarly, production in civil engineering surpassed the 2010 level by 36.6% in 2016, due to the increase in public investment in transport infrastructure (see TO 1 - Investment conditions and volumes).

The total added value² of the broad construction sector amounted to EUR 26.8 billion in 2016³, with the construction sub-sector accounting for 39.3% of the total, followed by real estate activities (37.9%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 14.7% in 2014⁴, compared to 16.9% in the EU28, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Estonia totalled 18,085 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 52.6% of the total firms, and the real estate activities for 28.8%. Overall, the number of enterprises in the broad construction sector increased by 23.6% during the period 2010-2016, mostly driven by the 44.9% growth in architectural and engineering activities, followed by 27.7% in the narrow construction and 17.2% in manufacturing.

Production in construction of buildings experienced a 69.6% increase between 2010 and 2016, followed by a 43.9% increment in construction over the same period of time. Similarly, production in civil engineering rose up by 39% in 2013, which was the highest since 2010, however it dropped by 24% in 2016 keeping a 5.6% increase since 2010 (Figure 2).

The total added value of the broad construction sector amounted to EUR 2.2 billion in 2016², with the construction sub-sector contributing to 39.1% of the total³ (EUR 863 million), followed by real estate activities (32.1% of the total), manufacturing (23.8%), and architectural and engineering activities (5.1%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 17.2% in 2014, with real estate activities having the largest contribution (8.5%) (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Finland totalled 82,470 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 54.1% of the total firms. Overall, the number of enterprises in the broad construction sector increased by 16.6% between 2010 and 2016 mostly driven by the 54.9% growth in real estate sub-sector companies. Conversely, the number of companies in the construction and architectural and engineering sub-sectors remained stable, whereas the manufacturing sub-sectors experienced a 12.5% decline. Production in the construction of buildings has been on the road to recovery since 2010, exceeding the 2010 level by 13.6% in 2016 (Figure 2). Similarly, production in civil engineering has been steadily increasing over the same years, surpassing its 2010 level by 17.7% in 2016.

The total added value of the broad construction sector amounted to EUR 19.1 billion in 2016², with the construction sub-sector contributing to 54.4% of the total³ (EUR 10.4 billion), followed by real estate activities (EUR 4.4 billion, i.e. 23.1% of the total), architectural and engineering activities (EUR 2.6 billion, i.e. 13.4%) and manufacturing (EUR 1.8 billion, i.e. 9.2%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 18.3% in 2014, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in France totalled 834,617 in 2016¹ (Figure 1). Companies in the narrow construction sector accounted for 60.7% of the total, followed by real estate activities (26.3%), architectural and engineering activities (11.0%) and manufacturing (2.0%). The overall number of enterprises in the broad construction sector grew by 19.6% between 2010 and 2016, driven by the 46.5% increase in the number of companies in real estate activities and the 24.0% growth in the number of enterprises in architectural and engineering activities. Production in construction declined by 12.9% over 2010-2016. In particular, production in construction of buildings dropped by 13.9% and production in civil engineering experienced an 8.7% fall over the same period (Figure 2).

In 2016², the total value added of the broad construction sector was EUR 155.4 billion (Figure 3), with the narrow construction sub-sector having the largest share (55.8%), followed by real estate activities (23.7%), architectural and engineering activities (13.7%) and manufacturing (6.8%). The share of gross value added of the broad construction sector in the GDP³ reached 18.7% in 2014, with real estate activities having the largest contribution (Figure 4). This is slightly above the EU-28 average of 16.9%.

• Country fact sheet

In 2016, there were 650,813 enterprises operating in the broad construction sector in Germany, with the narrow construction sector (NACE F) accounting for 55.6% of the total (Figure 1). The number of companies in the broad construction sector has increased by 21.2% since 2010 (536,874), with the most significant increase occurring in 2013-2014 (+22.3%). Since a low point in 2010, production in construction has been fluctuating, but registered an overall growth rate of 10.4% over 2010-2016. In particular the civil engineering segment recorded a strong performance over this period (+18.6%), while growth in the construction of buildings stood at 8.5% (Figure 2).

In 2016, the total value added of the broad construction sector was EUR 233.6 billion (Figure 3), with the narrow construction sub-sector having the largest share (43.7%, i.e. EUR 102.2 billion). It was followed by real estate activities with a share of 29.8% (EUR 69.6 billion), architectural and engineering activities with 16.6% (EUR 38.7 billion), and manufacturing with 9.9% (EUR 23.0 billion). In terms of gross value added as a share of GDP¹, real estate had the highest share (9.8%) in 2016, followed by narrow construction (4.3%) (Figure 4).

• Country fact sheet

In 2016¹, 148,750 enterprises were operating in the broad construction sector in Greece, with the construction sub-sector (NACE F) accounting for 57.8% of the total firms (Figure 1). Compared to 2010, the number of firms operating in the broad construction sector decreased by 17.7%. The manufacturing sub-sector experienced the greatest drop (-35.1%), followed by construction (-20.8%) and architectural/engineering activities (-7.6%). Only real estate activities reported a slighter loss, with its companies declining by 4.9% since 2010.

Production in the construction of buildings dropped by 58.8% between 2010 and 2016, although it showed signs of stabilisation since 2012, without, however, fully reaching the pre-crisis level (Figure 2). This collapse goes in parallel with the drop in demand and the housing market crash following the crisis (see Access to housing). Similarly, production in civil engineering suffered from severe budget cuts and fall in infrastructure investments (see TO 1- Stimulating favourable investment conditions- Investment conditions and volumes), thus decreasing by 59.2% between 2010 and 2012. It subsequently started to recover, increasing by 62% between 2012 and 2016. However, it is still far from full recovery, standing 34% below the 2010 level.

The total added value² of the broad construction sector amounted to EUR 5.7 billion in 2016³, with the construction sub-sector contributing to 60.2% of this total (i.e. EUR 3.4 billion), followed by manufacturing (18.0%), architectural and engineering activities (13.5%) and real estate (8.3%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 19.8% in 2014, with the real estate activities sub-sector having the largest contribution (Figure 4), which is almost 3 percentage point higher than the EU28 average, which stands at 16.9%.

• Country fact sheet

The number of enterprises in the broad construction sector in Hungary amounted to 118,595 in 2016¹ (Figure 1). Companies in the narrow construction sector accounted for 47.3% of the total, followed by real estate activities (27.6%), architectural and engineering activities (19.7%) and manufacturing (5.4%). The overall number of enterprises in the broad construction sector experienced a 8.4% decline over 2010-2016, mainly led by the 16.8% and 12.2% drops in the number of narrow construction and manufacturing companies.

Production in construction recorded a 11.5% decrease over 2010-2016, dropping by 6.5% in 2012 relative to 2010 and despite an increase of 9.0% noted in 2015, dropped again by 18.8% in 2016, below the 2010 value (Figure 2). Similarly, production in construction of buildings and civil engineering dropped by 6.8% and 17.5% over 2010-2016, respectively, being below the 2010 level.

In 2016², the total value added of the broad construction sector was EUR 6.1 billion (Figure 3), with the narrow construction sub-sector having the largest share, followed by real estate activities, manufacturing and architectural and engineering activities.

The share of gross value added of the broad construction sector in the GDP³ reached 11.6% in 2015, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Ireland was estimated at 78,833 in 2016¹ (Figure 1). Companies in the narrow construction sector represented 69% of the total, followed by real estate activities (17.6%), architectural and engineering activities (10.7%) and manufacturing (2.8%). The overall number of enterprises in the broad construction sector in 2016 was 6.7% above the 2010 level, with the real estate activities sub-sector experiencing the highest increase (21.8%), followed by architectural and engineering activities (8.3%). Companies in the manufacturing and construction sub-sectors saw a 2.5% and 3.4% increase in numbers, respectively.

Production in construction of buildings dropped drastically between 2010 and 2012 (-23.2.3%) (Figure 2), but started to recover after 2013, increasing with 38.7% from the 2010 level by 2016. Similarly, production in civil engineering fell by 33% in2011 and despite a steady increase over 2012-2015, it was still 1.4% below the 2010 level by 2016.

In 2016, the total value added of the broad construction sector was estimated at EUR 10.6 billion (Figure 3), with the construction sub-sector having the largest share (60.8%, i.e. EUR 6.5 billion), followed by architectural and engineering activities (16%, i.e. EUR 1.7 billion), real estate activities (15.6%, i.e. EUR 1.6 billion) and manufacturing (7.5%, EUR 800 million). The share of gross value added of narrow construction and real estate activities² in the GDP³ reached 2.6% and 5.7% in 2016, respectively (Figure 4).

• Country fact sheet

The Italian construction sector is a vital part of the national economy, with its gross value added accounting for 18.8% of GDP.

In 2017, the sector experienced a modest growth, as reflected by the increase of the total added value or the total turnover of the broad construction sector. However the sector still faces numerous challenges. Italy has experienced a 9.8% drop in the number of construction companies between 2010 and 2017, with sharp drops in terms of the profitability of the sector (the turnover decreased by -19.3% in the same period). Likewise, production decreased by 32.2%, and the number of workers by 23.3%.

Two key issues currently hinders the sustainable development of the Italian construction industry. First, access to finance has been excessively limited, with outstanding loans to the construction sector declining by 21.8% between 2010 and 2016 (from EUR 170.6 billion to EUR 133.4 billion). New loans to construction businesses also decreased by 68% in value between 2007 and 2016. Second, late payment remains a key issue in the sector, exacerbating the issue of liquidity in the sector. 70% of companies reported delays in payment from Public Administrations in 2017, having to wait an average of 156 days before being paid. In addition, the Italian construction sector reports one of the worst payment practices in the general economy, with only 5.7% of payments being settled by due date in 2016. As a consequence, the number of failures in construction is at historically high levels. However, the number of bankruptcies has declined by 8.6% in comparison to 2016.

Although residential building permits and the house price index dropped by 54.0% and 14.0% over 2010-2016, respectively the housing market has been picking up since 2014, with the number of residential sale transactions increasing by 16.3%, from 444,636 in 2015 to 517,164 in 2016. This is spurred by low interest rates (2.4% compared to 3.6% in 2010) and improved mortgage lending to households. To offset the 15.1% drop in construction investment over 2010-2016, investment initiatives have been set up, reversing the declining trend since 2014. The Budget Law 2017 introduces important measures to stimulate public and private infrastructural investment. In particular it focuses on seismic safety measures (up to 85% deduction) and energy efficiency. Moreover, the Investment and Infrastructure Development has a budget of €47 billion of euros for the period 2017-2032. EU funds are also crucial, with EUR 3.4 billion from the European Regional Development Fund (ERDF) allocated for network infrastructures in transport and energy alone during 2014 -2020.

There has also been an improvement in innovation and sustainable construction among companies, with increasing R&D expenditure in some sub-sectors.

The country’s main innovative strengths lie in International scientific co-publications, and SMEs innovating in-house. Moreover the use of BIM technologies is growing in the sector, and they will be mandatory for all projects by 2022. The market for energy efficient renovation is also booming, spurred by the Renovation Bonus and Eco Bonus, offering tax deductions of up to 65% on eligible renovation interventions. Italian construction companies also fare remarkably well in foreign markets, both within the EU and internationally (Latin America, Africa and the Middle East).

After a period of sustained decline, there will be a modest recovery in the construction sector in 2018, mainly led by investment in infrastructure and by EU funds. However, the workers employed in construction will continue to decrease, and the public administrations late payment and public procurement practices may discourage private investment in the future.

• Country fact sheet

The number of enterprises in the broad construction sector in Latvia totalled 25,266 in 2016¹ (Figure 1), with the real estate sub-sector accounting for 46.1% of the total and narrow construction for 37.8%. Overall, the number of enterprises in the broad construction sector increased by 17.7% during the 2010-2016 period, led by architectural and engineering activities (+52.7%) and manufacturing (+46.2%).

Production in construction increased by 40.0% over 2010-2014, declining over the subsequent years but still being 20.9% higher than 2010 in 2016 (Figure 2). Namely, production in construction of buildings peaked in 2014, being 79.3% higher than in 2010, but subsequently declined, though being 64.5% above the 2010 level in 2016. Conversely, production in civil engineering dropped after 2013, being 11.6% lower than the 2010 level in 2016.

The total added value of the broad construction sector amounted to EUR 1.9 billion in 2016², with the construction sub-sector contributing to 37.8% of the total³ (EUR 704.5 million), followed by real estate activities, manufacturing and architectural and engineering activities (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 20.3% in 2014⁴, with real estate activities having the largest contribution (11.7%) (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Lithuania totalled 44,820 in 2016¹ (Figure 1). Specifically, 58.4% of these belonged to the narrow construction sector, 22.9% were dedicated to real estate activities, 9.6% to manufacturing and 9.1% to architectural and engineering activities. The overall number of enterprises in the broad construction sector grew substantially by 82.8% between 2010 and 2016. The number of companies in the narrow construction doubled with an increase rate of 114.6% between 2010 and 2016, yet companies in real estate followed the same trend but grew less substantially by 52.7%. The overall production in the construction sector increased by 29.0% between 2010 and 2016, followed by considerable growth of 71.0% in the production of buildings. Production in civil engineering works rose by 33.0% in 2014, reaching the highest point and dropped by 28.0% in 2016 compared to the 2014 levels (Figure 2).

In 2016², the total value added of the broad construction sector was EUR 2.4 billion (Figure 3), with the narrow construction sub-sector having the largest share (51.8.6%, i.e. EUR 1.2 billion). It was followed by real estate activities with a share of 26.2%, manufacturing with 14.8% and architectural and engineering activities with 7.3%. The share of gross value added of the broad construction sector in the GDP³ reached 14.8% in 2014⁴, slightly below the EU-28 average of 16.9% with narrow construction having the highest share (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Luxembourg totalled 8,044 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 45.8% of the total firms, and the real estate activities for 36.0%, which represents 3,686 and 2,896 enterprises, respectively. Overall, the number of enterprises in the broad construction sector increased by 11.0% during the period 2010-2016. This increase was led by the growth of architectural and engineering activities (+15.8%), followed by construction (+14.5%) and real estate companies (+5.4%). On the other hand, the number of companies focused on manufacturing activities decreased by 5.6%, from 90 companies in 2010 to 85 companies in 2016.

Production in construction peaked in 2011 before dropping by 7.8% between 2011 and 2013. Since 2013, production recovered with a year-on-year improvement of 3.6% in 2014, yet being still below the pre-crisis level (Figure 2). Between 2014 and 2016, production continued to increase by 2.1%. The real estate sector was less affected by the crisis, contributing to the development of the construction sector².

The total value added of the broad construction sector amounted EUR 3.9 billion in 2016³, with the construction sub-sector contributing to 60.2% of the total⁴ (EUR 2.4 billion), followed by real estate activities (23.2% of the total), architectural and engineering activities (12.8%) and manufacturing (3.8%) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 13.3% in 2014, with the real estate sub-sector having the largest contribution, followed by narrow construction, architectural and engineering activities, and last manufacturing, as presented in Figure 4 below. This is below the EU28 average standing at 16.9%.

• Country fact sheet

The number of enterprises in the broad construction sector in Malta totalled 5,795 in 2016¹ (Figure 1), with the construction sub-sector accounting for 61% of the total. Overall, the number of companies in the broad construction sector declined by 5.2% since 2011 (5,510).

Production in construction² rose continuously between 2010 and 2015, peaking in 2015 due to the need to exhaust EU funds (+28.5%). It subsequently declined by 3.8% in 2016 as EU funded projects came to completion, though still being 23.6% higher than the 2010 level (Figure 2).

The total added value³ of the broad construction sector amounted to EUR 524.4 million in 2016⁴, with the construction sub-sector accounting for 59.3% of the total (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 8.1%⁵ in 2016, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in the Netherlands totalled 246,977 in 2016¹ (Figure 1), with the construction sub-sector (NACE F) accounting for 68.8% of the total firms. Overall, the number of enterprises in the broad construction sector increased by 28.9% between 2010 and 2016, mostly driven by the 48.4% growth in architectural and engineering companies, followed by 33.1% in construction and 14.5% in manufacturing. According to Bouwend Nederland (Building Netherlands), this growth is mostly attributable to the increase in one-person companies following the crisis, which make up the majority of companies in the industry. The volume index of production in construction² experienced an initial 12.1% drop between 2010 and 2013 due to the crisis, reaching a bottom low (Figure 2). However, it increased by 21.7% over 2013-2016 and overall increment of 7% is recorded over the period of 2010-2016.

The total added value of the broad construction sector amounted to EUR 54.7 billion in 2016³, with the construction sub-sector contributing to 49.0% of the total⁴ (EUR 26.8 billion), followed by 28.6% of real estate activities, 15.0% of architectural and engineering activities and 7.4% of manufacturing (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 11.4% in 2014⁵, slightly below the EU-28 average of 16.9%, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The Polish construction sector is composed mostly by small companies and several large players, totalling 453,026 firms in 2017.

Production in construction fluctuated between 2010 and 2016, and overall increased by 9.1% over 2010-2017 after a slight decline in 2016.

This growth was mainly driven by a 24.0% increase of production in the construction of buildings segment between 2010 and 2017. Both the production of civil engineering segment and narrow construction segments have increased again since 2016. While the civil engineering segment has dropped by 14.6% in the 2010-2017 period, the narrow construction sector remained stable. In parallel, employment fell at 5% below the 2010 level, reaching 1.3 million people employed in the broad construction sector in Poland.

The housing market has continuously been growing at a high pace (as indicated by the number of new flats built in 2017, which grew by 9.1% in comparison to 2016), with house price increasing by 2.1%.

The demand for housing is fostered by rising incomes of households (+24.6% between 2010 and 2015), low interest rates, and favourable policy schemes, such as the housing subsidies called ‘Apartments for the Young’.

That said, this growth could be slowed down in the future with the end of the government support program in 2018 and the expected heightened restriction on mortgage loan availability. The increase of housing demand may also have resulted from the changing structure of the sold flats. The number of relatively cheaper flats, purchased under the "Flat for the Young" scheme has diminished, while the number of more expensive buy-to-let flats has increased (Residential Market in Poland in 2017 Q2, REAS). This reflects a possibility of mounting shortages of housing supply, even though developers have increased the supply of flats. This is reflected by the growing number of building permits issued and dwellings under construction, which grew by 18.7% between 2016 and 2017.

The number of building permits grew by 18.7% in 2017 compared to 2016, while the number of completed dwellings reached 178,258 in 2017 (against 162,727 in 2016), indicating a 9.1% increase. Likewise, the EU funds allowed Poland to finance large infrastructure projects, including in the transport and energy sector.

The EU budget for the period 2014-2020 is expected to have delivered EUR 28 billion in support to infrastructure and transport.

On the other hand, construction costs, including materials, but also workers’ wages, have significantly increased. Hence construction companies’ income have largely suffered, as witnessed by the increasing number of bankruptcies. More generally, the issues of late payment and workers shortage already have significant impact on the sector’s growth, preventing companies to develop further. These issues will need to be tackled to ensure the development of the sector, which is expected to grow substantially, by 9.9% in 2018 and 10.0% in 2019.

This growth also reflects the growth of the Polish economy, which is predicted to grow by 4.3% and 3.7% annually in 2018 and 2019, respectively, due to social transfers, low interest rates and the spending of EU funds.

• Country fact sheet

In 2016¹, there were 147,149 enterprises in the broad construction sector in Portugal, with the construction sub-sector accounting for 51.3% of the total firms (Figure 1). The number of firms in the broad construction sector decreased by 18.9% since 2010 (181,379), although 2015 marked the end of the downward trend, recording a 0.6% increment compared to 2014. Narrow construction experienced the largest drop over 2010-2016 (-29.3%), while the real estate sub-sector increased its companies by 11.8%. Production in the construction of buildings has been dropping continuously between 2010 and 2016 (-45.0%), with the decline being exacerbated by the Portuguese sovereign debt crisis (Figure 2). Similarly, production in civil engineering fell by 50% over the same period, highlighting the fact that the Portuguese construction sector has still not recovered from the effects of the cuts in public spending and low levels of investment following the crisis.

The total added value² of the broad construction sector amounted to EUR 9.5 billion in 2016³, with the construction sub-sector contributing to 54.8% of the total (EUR 5.2 billion), followed by manufacturing, real estate and architectural and engineering activities (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 16.2% in 2014, in line with the EU28 average of 16.9%, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Romania totalled 89,943 in 2016¹ (Figure 1). Companies in the narrow construction sector accounted for 58.9% of the total, followed by architectural and engineering activities (16.9%), real estate activities (16.0%) and manufacturing (8.2%). The overall number of enterprises in the broad construction sector increased by 7.6% between 2010 and 2016. After a drop in 2011 from 83,559 to 74,673 enterprises, this number increased continuously driven by the 16.8% growth in companies in architectural and engineering activities, the 7.3% growth in companies in the narrow construction sector and the 6.1% growth in companies in real estate activities. Production in construction increased by 1.8% over 2010-2016. Specifically, production in construction of buildings increased by 21.4%, while production in civil engineering experienced a 9.7% fall over the same period (Figure 2).

In 2016², the total value added of the broad construction sector was EUR 9.4 billion (Figure 3). The construction sub-sector had the largest share (54.4%, i.e. EUR 5.1 billion), followed by real estate activities (17.7%, i.e. EUR 1.7 billion), manufacturing (15.0%, i.e. EUR 1.4 billion) and architectural and engineering activities (12.9%, i.e. EUR 1.2 billion).

The share of gross value added of the broad construction sector in the GDP³ reached 17.2% in 2014, with real estate activities having the largest contribution (8.1%) (Figure 4). This is in line with EU-28 average which stands at 16.9%.

• Country fact sheet

In 2016¹, there were 28,079 enterprises in the broad construction sector in Slovenia, with the construction sub-sector accounting for 58.7% of the total firms. Compared to 2010, the number of firms in the broad construction sector declined by 2.4%, with narrow construction reporting a 14.1% decrease. Conversely, architectural and engineering activities experienced a 25.7% increase, followed by real estate activities (+19%) (Figure 1). Production in construction of buildings dropped continuously between 2010 and 2013 (-60.3%), subsequently stabilising but still being 59.5% below the 2010 level in 2016 (Figure 2). Similarly, production in civil engineering decreased by 29.3% between 2010 and 2012, subsequently peaking in 2014 but then falling again and being 35.4% below the 2010 level in 2016.

The total added value² of the broad construction sector amounted to EUR 2.4 billion in 2016³, with the construction sub-sector contributing to 47.7% of the total (EUR 1.1 billion), followed by manufacturing, architectural and engineering activities and real estate (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 13.7% in 2014⁴, compared to 16.9% in the EU28, with real estate activities having the largest contribution (Figure 4).

• Country fact sheet

In 2016¹, there were 106,825 enterprises in the broad construction sector in Slovakia, with the construction sub-sector accounting for over 73% of the total firms (Figure 1). The number of firms in the broad construction sector decreased by 11.4% since 2010², with the manufacturing and construction sub-sectors experiencing the greatest drop ( 21% and -14.3%, respectively). Conversely, the number of enterprises in real estate increased by 22.5%. Production in the construction of buildings dropped by 23.4% between 2010 and 2014, reaching a record low (Figure 2). Although it showed signs of recovery in 2015, it declined again in 2016, being still 19.9% below the 2010 level. Production in civil engineering decreased by 26.8% over 2010-2012. After a subsequent stabilisation, it experienced a 53.5% increase in 2015 due to rapid consumption of EU funds (see Infrastructure). It plateaued in 2016, exceeding the 2010 level by 11.7%.

The total added value of the broad construction sector amounted to EUR 3.5 billion in 2016³, with the construction sub-sector contributing to 45.5% of the total⁴ (EUR 1.6 billion) (Figure 3). The share of gross value added of the broad construction sector in the GDP reached 14.7% in 2014⁵, compared to 16.9% in the EU28, with the construction sub-sector having the largest contribution (Figure 4).

• Country fact sheet

The number of enterprises in the Spanish broad construction sector amounted to 653,117 in 2016¹ (Figure 1). Companies in the narrow construction sector accounted for 60.0% of the total number of enterprises, followed by real estate activities (21.1%), architectural and engineering activities (13.8%) and manufacturing (5.2%). Spain experienced a sharp drop in the number of construction enterprises between 2010 and 2013 (-12.4%), but steady recovery in the following years (+16.9%) led to the 2.4% of increase in 2016 compared with 2010 values. The biggest increase since 2013 has been reported in narrow construction (22.4%), followed by real estate activities (18.9%), whereas the number of companies in the manufacturing sub-sector, and architectural and engineering activities only increased by 0.1% and 1.1% respectively.

Production in construction has been following a similar declining trend in 2010-2012 with the following partial recovery until 2016. More specifically, 2016 values compared to 2010’s are 3.2% below for construction, with the production in construction of buildings practically at the same level (-0.1%). The volume of production in civil engineering remains the lowest, being 17.3% under 2010’s index of production in 2016 (Figure 2). Despite the upward trend registered since 2013, (+16,9% increase since 2013).

In 2016, the total value added² of the broad construction sector amounted EUR 66.5 billion (Figure 3), with narrow construction having the largest share (53.6%). The total value added of the broad construction sector has been on decline until 2014 with a slow recovery till 2016, however still being 30,7% lower than in 2010. The share of gross value added of the broad construction sector in the GDP³ decreased by 12,6% between 2010-2015⁴, reaching in 2015 to 17.1%⁵, with real estate activities having the largest contribution (9.9%) (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in Sweden totalled 213,434 in 2016 (Figure 1). Companies in the narrow construction sector accounted for 49.8% of the total, followed by real estate activities (28.7%), architectural and engineering activities (18.8%) and manufacturing (2.7%). The overall number of enterprises in the broad construction sector experienced a 21.4% increase over 2010-2016, with growth in all sub-sectors at approximately 20%, with the exception of manufacturing, in which the number of companies declined by 7.5%. Production in construction and its subsectors was in decline between 2011 and 2013, but has been recovering since and in 2016 was 16.3% above its 2010 level. However, while production in the construction of building increased by 19.2% in that period, production in civil engineering remained below its 2010 value by 17.5%. (Figure 2).

In 2016¹, the total value added of the broad construction sector was EUR 2.4 billion (Figure 3), with the narrow construction sub-sector having the largest share (51.8.6%, i.e. EUR 1.2 billion). It was followed by real estate activities with a share of 26.2%, manufacturing with 14.8% and architectural and engineering activities with 7.3%. The share of gross value added of the broad construction sector in the GDP² reached 14.8% in 2014³, slightly below the EU-28 average of 16.9% with narrow construction having the highest share (Figure 4).

• Country fact sheet

The number of enterprises in the broad construction sector in the United Kingdom totalled 508,226 in 2017. The number of enterprises in the broad construction sector increased by 10.7% over 2010-2017, mainly driven by the 32.1% increase in the number of architectural and engineering companies. Despite dropping in 2012, product​ion in the broad construction sector has been increasing ever since, being 20.0% above the 2010 level in 2017. In turn, in 2017 , the broad construction sector employed 2,561,175 people, a 4.4% increase compared to 2010 (2,452,168).

In parallel, the UK housing market in facing two key issues. House price have increased significantly in recent years (+24.3% between 2010 and 2017), outnumbering pre-crisis level. House price vary per regions with the highest price increase recorded in East Anglia (+5.0%), followed by South West (4.4%), North West (4.1%) and East Midlands (4.1%). This growth of house price is also affected by the housing shortage currently faced by the UK. In fact, to address this issue, the UK would need to build an additional 232,000 to 300,000 new units per year. This led the government to establish plans to deliver 400,000 affordable housing units by 2020-21, 100,000 of which financed through a new GBP 2.3 billion (EUR 2.7 billion) Housing Infrastructure Fund.

The government’s objectives and priorities for future infrastructure investment are defined in the new National Infrastructure Delivery Plan 2016-2021. The latter includes a GBP 500 million (EUR 586 million) infrastructure pipeline. In addition, The new GBP 23 billion (EUR 26.8 billion) National Productivity Investment Fund will also finance investments in infrastructure, housing and research and development (R&D) over 2017-2022. These new policies will play a key role in supporting the growth of the construction sector in the UK.

The UK construction also faces major challenges, relating to labour and skills shortage. Post-Brexit could lead to a loss of 215,000 workers.

This would negatively affect the ability to deliver the planned housing units and ambitious infrastructural projects, and entail increases in construction costs when leaving the EU Single Market. Growth projections for the sector are low, forecast at 1.7% for 2018, 2.2% for 2019 and 2.5% for 2020, with residential buildings and infrastructure projects being core drivers of the sector’s growth.

Finally, the UK is a key player in sustainable construction and energy efficiency, especially in the context of residential building renovation. The Government developed several policies in this field, including the Energy Company Obligation (ECO) scheme. This measure aims to promote solid wall insulation, cavity wall insulation and replacement of heating systems for vulnerable households, by placing obligations on energy suppliers.

• Country fact sheet