The construction industry is set to grow by 5.2% this year, following the collapse in construction activity in 2020 amid the severe disruption caused by restrictions to contain the spread of Covid-19, data and analytics company GlobalData said on April 9.
The recovery in many markets in late 2020 surprised on the upside. This means the full-year outturn in 2020 was not as bad as previously expected, it states.
GlobalData estimates that global output contracted by 2.5% last year, which was lower than the previous estimate of 2.9%, and, excluding China, the contraction stood at 5.1%, said GlobalData lead economist Danny Richards.
Although it is recovering from the Covid-19 crisis, the global industry has borne a huge cost in terms of foregone revenue. Compared with GlobalData’s pre-Covid-19 predictions for construction output value, the output total in 2020/21 is close to $1.1-trillion lower than it would otherwise have been.
“In markets where the construction industry has managed to return to relatively normal levels of operation since the crisis engulfed the world in 2020, activity has rebounded positively, with signs that in some markets there has been a marked effort to get projects back on track quickly.
“With activity levels trending upwards in the absence of restrictions on site works, there are likely to be record high rates of year-on-year growth in major markets in the coming quarters, given the comparison to periods last year when construction sites were closed or when activity was severely disrupted. There are also positive signs for the coming quarters when assessing leading indicators, such as building permit approvals,” he said.
According to the company's 'Global Construction Outlook to 2025 Update' report, there is still great uncertainty about how the Covid-19 crisis will play out. Positive news is stemming from the successful roll-out of vaccines in many markets, although there are concerns over the reports of new variants and challenges in getting vaccines supplies to developing markets.
However, the forecast for the global construction output is predicated on the assumption that governments and public health authorities will not reintroduce strict lockdown policies and that construction sites will be able to continue to operate with minimal disruption, he said.