The global construction market size is a decline from USD 11,217.4 billion in 2019 to USD 10,741.2 billion in 2020. However, the industry showed signs of recovery since the beginning of 2021 and is expected to reach a market size of USD 13,572.4 billion in 2024, projecting a CAGR of 6.0% between 2020 and 2024.
Browse 43
market data Tables and 14 Figures spread through 84 Pages and
in-depth TOC on "Impact
of COVID-19 on Construction Industry Market by Type (Residential,
Non-Residential, and Heavy & Civil Engineering) and Region (North America,
Europe, Asia Pacific, Middle East & Africa, South America) - Global
Forecast to 2024 "
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Drivers:
Increasing automation in public spaces and rising awareness about antibacterial
construction materials
The public spaces will move toward more automation
to contain the spread of COVID-19. Designers will increasingly prefer
antibacterial fabrics and finishes, including those already existing, like
copper, and will inevitably be developed. Certain construction elements, which
are already standard in health care, may find application in other public
spaces, such as reducing the number of flat surfaces where germs can spread and
installing ventilation systems that help remove potentially contaminated air
from any given area. Health care design, too, will very likely get an upgrade
in the near future. While social distancing would seem necessary, it is
reasonable to expect that concerns about possible future virus outbreaks might
encourage architects to design with an eye on open spaces that enable and
encourage people to spread out.
Restraints:
Volatility in raw material prices
Raw material and energy used in different types of
construction have volatile prices and are set to continue in the forecast
period. Sudden increase or price decrease affects the end project cost and
profit margin of manufacturers and contractors. The primary raw materials used
in the construction industry are cement, aggregates, sand, steel, aluminum,
wood, glass, flooring materials, wall materials, and cladding materials.
Volatility in the prices of energy and crude oil used for
manufacturing and transporting these materials is the leading cause of
fluctuations in the prices of these raw materials. These fluctuations, in turn,
results in the volatility of prices of finished buildings. The
instability of petroleum and crude oil costs may cause the price of raw
materials to rise and increase the cost of raw materials used in precast
concrete. Hence, the prices of these materials have a direct impact on
the cost of precast concrete. Furthermore, with an increase in the cost of raw
materials, vendors increase the price of their products or reduce their profit
margins, which will have an adverse effect on the market growth.
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Residential
is the major segment of the construction industry.
Globally, construction is more than USD 11 trillion
industry, of which residential construction is the largest sector. The occurrence
of COVID-19 has caused disruption in the residential construction sector. The
main disruption is in the supply chain. The transformation of COVID-19
from a China-centric challenge to a global pandemic has resulted in shifting
the impact to the global construction supply chains and markets.
The ongoing pandemic has created a number of
challenges not only for the construction industry but also disrupted the global
economy. The global crisis, duration of the recession, and path of recovery
will largely determine the nature and severity of these challenges. The
construction industry, particularly the new residential segment, was performing
well and witnessing a surge in activity across many sectors in 2020. Owing to
the rising number of cases in across the globe, many ongoing projects that were
considered essential by the government authorities were not stopped, but new
residential construction permits were suspended.
In the previous situation, the builders and
contractors are struggling to obtain permits for both new and in-process
construction projects. At present, both construction companies and workers are
resuming their operations. However, new guidelines and regulations issued by
the governments have created uncertainty and confusion for the companies as
well as the laborers. Homeowners in regions with a high number of COVID-19
cases are limiting contractor access or entrance into homes and are preferring
DIY projects as families are staying home.
Larsen & Toubro (L&T) is one of the leading
construction contractors in the world. The company is a major technology,
engineering, construction, manufacturing, and financial services conglomerate
with operations all across the globe. It caters to industries, such as
hydrocarbon, infrastructure, power, process industries, and defense. In
2021, L&T joined a national effort to overcome the oxygen shortage. L&T
will soon start delivering 22 oxygen generators to various hospitals in India,
where the scarcity is most acute. These units will absorb air from the atmosphere
before converting it into medical-grade oxygen and pumping it into pre-existing
pipes in hospitals.
Bechtel Group Established in 1898, Bechtel Group,
Inc. provides engineering and construction services. It caters to industries
such as infrastructure, oil & gas, and mining & metals worldwide. The
company offers technology, procurement, and project management services. It is
into designing and building roads, airports, nuclear power plants,
communication networks, mines, pipelines, and oil & gas field development
projects. The Bechtel Group Foundation donated USD 3 million to communities
globally, coping with the coronavirus pandemic, in partnership with the
crowdfunding nonprofit organization GlobalGiving. The newly established Bechtel
COVID-19 Relief Fund has supported local nonprofit organizations that provide
vital services in areas where Bechtel Corporation maintains offices and project
sites.
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