8 percent drop: Swiss construction companies feel significant slowdown

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Thus, it amounted to just under CHF 5.9 billion. According to the statement, construction projects in many sectors and regions were resized or postponed.

According to the association, there are many reasons for this. As economic growth slows, companies will be wary of investment in construction. The rapid rise in interest rates poses an obstacle to new investments, especially in residential construction projects.

High material prices are still a stumbling block. The summit has probably been passed, but construction costs are still 10 percent above pre-pandemic levels, according to the communique.

In summary, the association expects construction activity to be slightly lower in the next one to two years compared to previous years.

According to the construction indexes of Credit Suisse and Swiss Builders’ Association, the construction industry expects to cool down even more in the second quarter. The index, which is accepted as the leading indicator, decreased by 2.4 percent compared to the previous quarter and became 153 points. Economists at CS write that this decline was mainly due to civil engineering, which fell 6.3 percent from a high.

However, the construction index shows a slight increase of 1.1 percent compared to the same quarter last year, which means that the short-term outlooks are still solid. It is quite possible that the annual comparison in the second quarter will even compensate for the decrease in the first quarter of the previous year. Baumeister statistics for the first quarter show that actual sales fell 3.1 percent to just under 4.7 billion.

(SDA)

Source :Blick