The construction sector is of vital importance to the European economy. With 3 million enterprises and a total direct workforce of 18 million people, the construction sector contributes at around 9% to the GDP of the European Union.
99.9% of the European construction sector is composed of small and medium-sized enterprises (fewer than 250 employee). In the EU, the average size of construction enterprises is of 4 workers (employees or not). Small and medium businesses produce 80% of the construction industry's output. Small enterprises (less than 50 employees) are responsible for 60% of the production and employ 70% of the sector's working population.
As from 2015 the construction industry seems on the path to recovery, according to data from Eurostat and from Euroconstruct, a network of research centres specialised in construction economics.
Production of the European construction sector Eurostat registers an increase of 2.3% in production in construction in the 28 Member States in February 2016, compared with February 2015. This is due to building construction rising by 2.9%. Among Member States for which data are available, the highest increases in production in construction were recorded in Slovakia (+18.8%), Spain (+13.0%) and Sweden (+11.3%).
The largest decreases were found in Slovenia (-30.8%), Hungary (-19.3%) and Poland (-10.1%). In France construction SMEs activity grew by 1% in the first quarter of 2016, breaking with a continuous downwards cycle since 2012. After a very moderate growth in 2014, the growth rate of total construction output foreseen for 2015 was revised to 1.6% in December 2015, according to Euroconstruct.
All Central and Eastern European countries experienced significant growth as they tried to absorb all available EU funds from the previous programming period.
Construction output in 2016 will be more positive than predicted with also a positive trend for 2017. Euroconstruct foresees a record growth rate of 3% for 2016 (as opposed to 2.4% in 2015) and 2.7% for 2017.
The European construction market has entered a phase of recovery but there is no guarantee of long-lasting effects as long as confidence from households and businesses is not back: the labour market is still weak in several countries, the credit market remains limited and public accounts corrections are still ongoing.