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Market survey

5 MAY 2021

Global Construction Monitors

The Global Construction monitors are a sentiment indicator of the construction and infrastructure markets in the UK, Europe, Asia Pacific, North America, Middle East and Africa.

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Highlights from the Q2 2022 Global Construction Monitor

The more challenging   economic backdrop starts to take its toll on construction activity in Europe and APAC whereas feedback appears more resilient in other regions.

The infrastructure sector is expected to remain solid growth globally with upgraded expectations across Middle East in Q2 as the net balance went up to +58% from an already strong figure of +48% in the past.

At the global level, headcounts are anticipated to increase aligned with the expected rise in workloads over the next 12 months.

Alongside intense inflationary pressures which are a major obstacle to construction activity reported by 88% of contributors, material availability is another significant challenge cited by around 75% of respondents.

Key insights from regions covered in this quarter’s report include:

UK: Workloads and expectations for the next twelve months remain firm across the industry despite the challenge of labour and material shortages and a growing problem of financial constraints due to rising interest rates and further deteriorating credit conditions.

Asia Pacific: Whilst the headline Construction Activity Index shows a weakly positive signal,  there is divergence across countries . Activity has continued to accelerate in India leading the performance across the region, remained relatively firm in Australia, New Zealand, Philippines and Singapore, and softened in China, Hong Kong and Sri Lanka and Malaysia.

Infrastructure remains a dominant sector in the region while rising construction costs remain a key challenge and financial constraints isan obstacle cited by a high proportion of respondents (75%).

Europe: Sentiment slips into neutral territory from +18 last quarter  to +5 this quarter following a positive Construction Activity Index reading in the last five successive quarters. Alongside the more challenging macro environment which has resulted in a less upbeat outlook of the market, material shortages and rising costs are also cited by majority of contributors to be hindering the sector.

There is a divergent country-level picture in the region with positive readings for UK, Romania and Italy and softer figures for Netherlands, Germany, Ireland, Spain and France compared to the average record in the last 12 months.

Private residential sector still shows a modest pick-up in output in the next 12 months despite a generally flat outlook of the market across the region. 

Middle East and Africa: Momentum slows down in MEA with the readings of the Construction Activity Index slipping from +29 in Q1 to +18 during Q2. That said, growth continues to be particularly strong in Saudi Arabia given the rising oil production and high oil prices.

The outlook across the region is generally positive along with anticipated increase in workloads and headcount. However, as is evident elsewhere, material costs and financial constraints are identified as key issues faced by the industry.

North America: Sentiment remains positive and workloads shows positive trends in America and Canada. However, ongoing issues around materials, labour, financial headwinds and broader economic concerns led to a more cautious mood of the respondents anticipating a slow profit growth and further loss in momentum.

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