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Construction Market Size, Trends and Growth Forecasts by Key Regions and Countries, 2022-2026

The construction market is facing severe headwinds globally after making good progress in recovering from the severe downturn recorded in 2020 amid the widespread disruption caused by restrictions imposed to contain the spread of COVID-19. There is a high degree of uncertainty over the short-term outlook in the industry following Russia’s invasion of Ukraine. The war will exacerbate existing supply chain disruptions and put even greater upward pressure on energy prices, which will further drive up prices for key construction materials.

Investment in the residential sector continues to be buoyed by government support measures and housebuilding programs. Moreover, investment in the infrastructure and energy and utilities sectors has been a major driver of the recovery in overall construction output. Industrial construction has also been recovering from the COVID-19 induced downturn in 2020. This construction market report provides a detailed analysis of the prospects for the global construction industry up to 2026.

What is the regional outlook of the construction market?

The key regions in the construction market are the US and Canada, Latin America, Western Europe, Eastern Europe and Central Asia, South-East Asia, South Asia, Australasia, North-East Asia, Middle East and North Africa, and Sub-Saharan Africa.

The US and Canada

The construction output in North America stayed flat in 2021. However, the general outlook for the industry is positive as infrastructure spending gathers pace. In the US construction industry, the residential housing sector has been the key driver of overall construction activity, but price pressure and tightening in monetary policy is starting to weigh on output. The Canadian construction industry’s output in 2021 was supported by investments in residential buildings, repair works, and civil construction activities. In contrast, non-residential construction activities registered a marginal decline in 2021.

Latin America

The global surge in commodity prices and supply-chain fragilities have led to rampant inflation in major economies of Latin America, such as Brazil and Argentina. Construction material costs such as steel, lumber, and concrete have weighed on the value chain causing delays and cost hikes. Price pressure is unlikely to be alleviated in the short run with the ongoing war in Ukraine and the sanctions in Russia pushing primary product prices upwards. The residential sector looks to suffer most from the increase in interest rates. However, higher prices in commodities have benefitted much of Latin America as soaring copper, lithium, and other base metal prices have resulted in increased export earnings and tax revenue. Continued focus on renewable energy investment is further shifting the energy generation sector in Latin America.

 Western Europe

Significant government spending has supported the recovery in the construction sector across Western Europe. However, high materials prices and product shortages hampered works on projects, and the situation is set to worsen in 2022 given the fallout from Russia’s invasion of Ukraine. Russia and Ukraine are key suppliers of steel to the region, and disruptions to oil and gas supplies are having a major impact on energy costs across the region. Commercial construction is also expected to start to recover from the slump recorded in the past two years. An increase in tourism and commercial activities, as well as an increase in the total value of new orders from private office and entertainment construction, bodes well for the implementation of new investment plans. The residential sector is also expected to continue to expand.

Eastern Europe and Central Asia

Construction markets in Eastern Europe faced risks owing to the impact of the Russia-Ukraine war, which is expected to stoke inflation and weaken investor confidence in the region. Construction in Ukraine will be completely halted while the Russian invasion continues. The Russian economy will suffer heavily from punitive sanctions placed on the country by Western governments while economies that are heavily interlinked with Russia will suffer as it will disrupt trade, supply chains, remittances, and tourism activity. In addition, a historic surge in refugees flowing out of Ukraine into neighboring countries such as Poland, Hungary, and Romania is likely to strain public finances in the short term. Infrastructure spending is likely to continue with the support of EU recovery funds.

South-East Asia

Construction industry growth in South-East Asia moderated further in the final quarter of 2021. Contributing to this revision was a weaker than expected rebound in Q4 2021 in the Vietnamese construction industry, following a significant contraction in Q3, and the continued downturn of Malaysian construction activity. Construction output in South-East Asia is likely to have moderated further in the first quarter of 2022. Risks to the outlook in the region include rising oil and energy prices due to the conflict in Ukraine and its impact on both the cost of construction materials and inflation. Rising inflation may lead to an increase in wage costs, particularly in those economies where labor supply is currently tight, and press central banks to tighten policy, increasing the cost of debt financing.

 South Asia

The Ukrainian war and the resultant surge in oil and gas prices will affect the construction industry in South Asia. However, the industry is expected to continue growing albeit at a moderate pace over the short term, led by growth in India. This will be followed by robust expansion over the remainder of the forecast period. Underlying support will come from the rising middle-class population, driving consumption growth, and leading to investments in housing and infrastructure. Industrial construction is likely to benefit from the COVID-19 crisis for a medium to long period. This is because the industrialized countries are looking to diversify their supply chain away from China, and the region offers attractive alternatives with low labor costs as well as a large captive market in the form of an expanding middle-class population. However, the emergence of newer and more fatal variants of COVID-19 may lead to tighter containment measures hampering growth.

 Australasia

Construction activity in Australasia was buoyant in 2021, overcoming the disruption in Q3 that occurred due to an outbreak of the Delta variant of the coronavirus. The growth of the region’s construction output was bolstered by a stronger than expected rebound in Q4 in New Zealand. A tightening of restrictions in both New Zealand and Australia in the first quarter of this year in response to outbreaks of the Omicron variant may temper construction industry growth during the quarter. Downside risks to the region’s construction outlook this year include the impact of rising energy and oil prices due to the conflict in Ukraine and its resulting impact on construction material costs and inflation. With labor supply in the region already tight, wage costs are likely to rise, which may deter new construction investment in the region.

North-East Asia

The growth of construction output in North-East Asia slowed in the final quarter of 2021, primarily due to another weak period of construction activity in the Chinese residential sector. Government restrictions on debt growth at Chinese real estate developers are expected to soften new residential development in the short term, and this is expected to be further exacerbated by falling home prices and sales volumes. Elevated debt levels at Chinese local governments may further temper construction growth in China this year. Further risks to construction output in the region include the impact of the conflict in Ukraine on oil, energy prices, building material costs, and inflation, as well as the prospect of additional restrictions on activity to curb COVID-19 infections. After declining in 2021, the residential construction sector will see positive growth this year with the government’s focus on the development of subsidized housing units.

Middle East and North Africa

The surging oil prices and the sanctions on Russia are expected to benefit the oil and gas rich Middle East and North Africa (MENA) region. However, there are downside risks stemming from Russia’s invasion of Ukraine. Notably, investor confidence will be undermined by the intense geopolitical uncertainty, and the supply disruptions will compound existing upward pressure on key construction materials. Food grain inflation will also accelerate, putting greater pressure on household spending and consumer confidence, which had been recovering in the wake of relaxation of COVID-19 restrictions. Saudi Arabia’s construction industry is expected to register growth this year, supported by developments in infrastructure, energy and utilities, and residential construction projects.

 Sub-Saharan Africa

Construction output growth was sluggish in 2021 in Sub-Saharan Africa due to COVID-19 restrictions and weak investment. This limited the recovery from the sharp 2020 downturn. There was subdued growth or even high contractions in some quarters of 2021, and as a result of the low base effects, there will be positive growth in Nigeria, South Africa, and Angola where output levels are still significantly below the pre-COVID level. To free up funds to support sectors heavily affected by the crisis, there will be a focus on negotiating debt relief and restructuring with external creditors. The key risks associated with the industry’s development in the short and medium-term could be electricity supply disruptions, increased labor shortages, rising oil prices, and supply chain constraints.

Construction market, by regions

Construction market, by regions

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Market report scope

Key regions The US and Canada, Latin America, Western Europe, Eastern Europe and Central Asia, South-East Asia, South Asia, Australasia, North-East Asia, Middle East and North Africa, and Sub-Saharan Africa

This report provides

  • An overview of the outlook for the global construction industry to 2026.
  • Analysis of the outlook for the construction industry in major global regions: North America, Latin America, Western Europe, Eastern Europe, South Asia, South-East Asia, North-East Asia, Australasia, the Middle East and North Africa, and Sub-Saharan Africa.
  • A comprehensive benchmarking of 91 leading construction markets according to construction market value and growth
  • Analysis of the latest data on construction output trends in key markets.

Reasons to Buy

  • Evaluate regional construction trends from insight on output values and forecast data to 2026.
  • Identify the fastest growers to enable assessment and targeting of commercial opportunities in the markets best suited to strategic focus.
  • Identify the drivers in the global construction market and consider growth in emerging and developed economies. Formulate plans on where and how to engage with the market while minimizing any negative impact on revenues.

Table of Contents

Table of Contents

1. Global Outlook

2. Regional Outlook: US and Canada

2.1 Overview

2.2 Key Updates

3. Regional Outlook: Latin America

3.1 Overview

3.2 Key Updates

4. Regional Outlook: Western Europe

4.1 Overview

4.2 Key Updates

5. Regional Outlook: Eastern Europe and Central Asia

5.1 Overview

5.2 Key Updates

6. Regional Outlook: South-East Asia

6.1 Overview

6.2 Key Updates

7. Regional Outlook: South Asia

7.1 Overview

7.2 Key Updates

8. Regional Outlook: Australasia

8.1 Overview

8.2 Key Updates

9. Regional Outlook: North-East Asia

9.1 Overview

9.2 Key Updates

10. Regional Outlook: Middle East and North Africa

10.1 Overview

10.2 Key Updates

11. Regional Outlook: Sub-Saharan Africa

11.1 Overview

11.2 Key Updates

12. GlobalData Construction

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List of Tables

List of Tables

Table 1: Global Construction Output Growth (Real, % Change), 2020-2026

Table 2: North America, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 3: Latin America, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 4: Middle East and North Africa, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 5: Sub-Saharan Africa, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 6: South-East Asia, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 7: South Asia, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 8: North-East Asia, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 9: Australasia, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 10: Western Europe, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 11: Eastern Europe, Construction Output Value (Real, US$ 2017 Billion), 2016-2026

Table 12: US and Canada, Construction Output Growth (Real, % Change)

Table 13: Latin America, Construction Output Growth (Real, % Change)

Table 14: Western Europe, Construction Output Growth (Real, % Change)

Table 15: Eastern Europe and Central Asia, Construction Output Growth (Real, % Change)

Table 16: South-East Asia, Construction Output Growth (Real, % Change)

Table 17: South Asia, Construction Output Growth (Real, % Change)

Table 18: Australasia, Construction Output Growth (Real, % Change)

Table 19: North-East Asia, Construction Output Growth (Real, % Change)

Table 20: Middle East and North Africa, Construction Output Growth (Real, % Change)

Table 21: Sub-Saharan Africa, Construction Output Growth (Real, % Change)

List of Figures

List of Figures

Figure 1: Global Construction Output Value (Real, 2017 US$ Billion), 2019-2026

Figure 2: Global Construction Output Growth (Real, % Change), 2016-2026

Figure 3: US and Canada, Construction Output Value (Real, US$ 2017 Billion)

Figure 4: The US, Number of People Employed in the Construction Industry, In Thousands

Figure 5: Canada, Construction Value-Add (Real, % Change YoY)

Figure 6: Latin America, Construction Output Value (Real, US$ 2017 Billion)

Figure 7: Brazil, Construction Value-Add (BRL Billion, Seasonally Adjusted Chained 1995 Prices)

Figure 8: Mexico, Construction Value-add (2013 Prices, MXN Billion)

Figure 9: Argentina, Construction Value Add (ARS Million, 2004 Constant Prices)

Figure 10: Colombia, Construction Value-Add (COP Billion, 2015 Chained Volumes)

Figure 11: Chile, Gross Fixed Capital Formation (Constant 2013 Prices, % Change YoY)

Figure 12: Peru, Construction Materials Price Index (2013=100)

Figure 13: Western Europe, Construction Output Value (Real, US$ 2017 Billion)

Figure 14: Germany, Construction Value-Add (Chain Volume, EUR Billion)

Figure 15: Spain, Construction Value-Add (Chain Volume, EUR Billion)

Figure 16: France, Construction Value-Add (Chain Volume, EUR Million)

Figure 17: UK, Construction Output Volume (Chain Volume Seasonally Adjusted, GBP Million)

Figure 18: Italy, Construction Value-Add (Chain Volume, EUR Million)

Figure 19: Netherlands, Construction Value-Add (Chain Volume, EUR Million)

Figure 20: Eastern Europe and Central Asia, Construction Output Value (Real, US$ 2017 Billion)

Figure 21: Hungary, Construction Value-Add (HUF Million, Seasonally Adjusted Constant Prices)

Figure 22: Turkey, Residential Property Price Index (RPPI) (2017 = 100)

Figure 23: Turkey, Construction Value-Add (TRY Million, 2009 Chain Linked Volume Measures)

Figure 24: Poland, Construction Value-Add (PLN Million, 2015 chained prices)

Figure 25: Estonia, Construction Value-Add (EUR Million, 2015 Chained Linked Prices)

Figure 26: Lithuania, Construction Value-Add (Chain-Linking method, Seasonally and working day unadjusted data, EUR Million)

Figure 27: South and South-East Asia, Construction Output Value (Real, US$ 2017 Billion)

Figure 28: Indonesia, Construction Value-Add (IDR Billion, 2010 Prices, Seasonally Adjusted)

Figure 29: Thailand, Construction Value-Add (THB Million, Seasonally Adjusted Chained Volume Measures)

Figure 30: Singapore, Construction Value-Add (SGD million, 2015 Chained Prices, Seasonally Adjusted)

Figure 31: Malaysia, Construction Value-Add (MYR Million, 2015 Prices, Seasonally Adjusted)

Figure 32: Philippines, Construction Value-Add (PHP Billion, 2018 Prices)

Figure 33: South Asia, Construction Output Value (Real, US$ 2017 Billion)

Figure 34: India, Construction Value-Add (INR Billion, Constant Prices)

Figure 35: Bangladesh, Total Private Sector Bank Advances to Construction (BDT Billion)

Figure 36: Australasia, Construction Output Value (Real, US$ 2017 Billion)

Figure 37: Australia, Construction Work Done (AUD Million, Chained 2018 Prices, Seasonally Adjusted)

Figure 38: Australia, Construction Value Add (AUD Million, Chained Volume Measures, 2018-19 Prices)

Figure 39: Australia, Building Approvals (AUD Million, Seasonally Adjusted, Chain Volume, 2018-19 Prices)

Figure 40: New Zealand, Volume of Building Work Put in Place (NZD Million, Seasonally Adjusted, 1999 Prices)

Figure 41: New Zealand, Construction Value-add (NZD Million, Chained Volume Measures, 2009-10 Prices)

Figure 42: New Zealand, Building Consents Issued, Three-month moving average (NZD Million)

Figure 43: North-East Asia, Construction Output Value (Real, US$ 2017 Billion)

Figure 44: China, Construction Value-Add Index (Constant Prices, % Change YoY)

Figure 45: Japan, Construction Contracts Received by Big 50 Constructors (JPY Billion, 3-month Moving Average)

Figure 46: South Korea, Construction Value-Add (KRW Billion, 2015 Chained Prices, Seasonally Adjusted)

Figure 47: South Korea, Value of Construction Orders Received (KRW Billion, 3-month Moving Average)

Figure 48: Taiwan, Construction Value-Add (TWD Million, 2016 Chained Prices)

Figure 49: Hong Kong, Construction Value-Add (HKD Million, 2019 Chained Prices)

Figure 50: Middle East and North Africa, Construction Output Value (Real, US$ 2017 Billion)

Figure 51: Saudi Arabia, Construction Value-Add (SAR Million, Constant Prices)

Figure 52: Qatar, Construction Value-Add (QAR Million, Constant Prices)

Figure 53: Egypt, Construction Value-Add (EGP Billion, 2016-2017 Base Prices), % Change YoY

Figure 54: Tunisia, Construction Value-Add (TND Million, Constant Prices)

Figure 55: Sub-Saharan Africa, Construction Output Value (Real, US$ 2017 Billion)

Figure 56: Nigeria, Construction Value-Add (NGN Billion, Constant Prices)

Figure 57: South Africa, Construction Value-Add (ZAR Million, Constant Prices)

Figure 58: Ghana, Construction Value-Add (GHS Million, Constant Prices)

Figure 59: Tanzania, Construction Value-Add (TZS Billion, Constant Prices)

Frequently Asked Questions

The key regions in the global construction market are the US and Canada, Latin America, Western Europe, Eastern Europe and Central Asia, South-East Asia, South Asia, Australasia, North-East Asia, Middle East and North Africa, and Sub-Saharan Africa.

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