Construction sector expects a slight cooling

Major construction works generated sales of 23.3 billion francs throughout 2022, the Swiss Builders Association (SBV) announced on Wednesday. This corresponds to an increase of 0.7 percent. In the last quarter, October through December, sales increased 2.0 percent to 6.13 billion.

However, according to the SBV, good development must be placed in perspective. Building materials have become more expensive to purchase. In real terms – that is, without these inflationary effects – production as a whole shrank by 2.0 percent in 2022.

In addition, only a fraction of the increased prices could be transferred. As a result, profit margins remained very low, 2 to 3 percent, according to the communiqué.

Credit Suisse and the Swiss Builders’ Association expect the construction industry to cool down a bit in 2023, according to their construction indices. The index, which is considered the leading indicator, decreased by 2.4 percent to 157 points. CS economists therefore conclude that the construction industry is unlikely to continue on its growth path into 2023. The decrease is due to commercial and residential construction.

However, experts emphasize that backlogs and new orders are still at a high level. In addition, the expected decline in sales is due not only to weakness in production, but also to signs of normalization in construction prices. (SDA)

Source :Blick