Vast Majority of Construction and Construction Material Managers Expect 30% Higher Construction Costs This Year

Managers in the construction industry are not very optimistic about the near future. 53% of managers in the construction industry think that construction volume in Europe will decline this year and next. In contrast, only 9% are optimistic and believe the construction industry will grow, according to a study by Interconnection Consulting.

Two-thirds of the 208 construction and construction material managers surveyed in Europe do not expect the construction industry to stabilise or normalise until 2024 or later. This year, 67% of the experts surveyed expect increases in construction costs of 30% or more. More than one-third say input costs will even increase by more than 50% this year. “Managers are also not at all confident that they will be able to pass on the increased costs entirely to their customers,” explains Jan Hudak, the author of the study. 55% of the respondents believe that sales prices will not increase by more than 25% this year. As many as a quarter of the respondents believe that prices will only rise by up to 15%.

Widespread Labour Shortage

The shortage of skilled labour, which is causing major problems for more and more companies in Europe, especially in industry, is a focal point for companies alongside price increases. For as many as one-third of the managers, the labour shortage is a recognisable problem for their company. For 13% of the companies surveyed, the labour shortage is even critical, meaning that orders are delayed or cannot be accepted at all as a result. On the other hand, 12% of the companies state that they have no problems with skilled workers or labour shortages.

Inflation Rate and Wage Increases

About half of the construction companies expect wages to increase by 8 to 12% during the current year. Another 35% believe that wage increases will be even higher. These expected wage increases depend on regional inflation. The inflation rate in the EU was 10.1% in August. However, there were large differences within the EU countries. In France the inflation rate was 6.6% in Estonia the inflation rate was 25.2%.

08/11/2022

Copyright: Interconnection, Publication free of charge for coverage regarding the study and InterConnection Consulting.

Jan Hudak

> Learn more about Jan Hudak

After expanding his international experience (in USA, Sweden and Slovakia) from studies and short traineeships & internships in insurance at Allianz and public sphere at Ministry of Economy, Jan joined Interconnection Consulting as the Market Analyst responsible for various industries. Among them are boats, parquets & flooring, finance, healthcare & pharma, FM and some of the special technical & construction industries. During his work at Interconnection, he was invited to present some of the findings and data at the conferences or EXPOS. In addition, he creates data solutions for B2B & B2C segment. Also, in Interconnection he is in charge of internship programme in Bratislava as mentor as well as providing assistance to other colleagues and recently he became a consultant for untypical projects and business development.

Contact me without obligation, I support you gladly!

Tel:+43 1 585 46 23 10

E-mail:hudak@interconnectionconsulting.com

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