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April 3, 2020

Weaker outlook, but business as normal in Swedish construction industry despite Covid-19

As the coronavirus epidemic worsens in Sweden, the Swedish government has refrained from implementing strict lockdown measures.

As the coronavirus epidemic worsens in Sweden, the Swedish Government has refrained from implementing strict lockdown measures. The Swedish Government is instead adopting a softer approach, and it has so far not implemented the same drastic polices as its Western European counterparts or even those in neighbouring Scandinavian countries, Norway, Finland and Denmark.

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The Internet of Things (IoT) is proving hugely beneficial to the construction industry, allowing different assets and people to be monitored and accounted for across a traditionally fragmented industry. As a result, companies that invest in IoT now promise to make long-term gains in the industry. According to GlobalData forecasts, spending on IoT in construction will reach $9.6bn by 2025. For an industry that has large sites to manage, strict project timelines, hazardous working conditions, and tight profit margins, IoT can create a manageable view of construction sites for project managers, streamline operations, and protect workers. In addition, it allows real-time data streams of assets, automates time-consuming tasks, and ensures employee safety and productivity. IoT integration with equipment manufacturing also has rich advantages for asset monitoring sensors. This, combined with artificial intelligence (AI) can help forecast materials and workers needed during the procurement stage and assist in forecast financing. Read GlobalData’s whitepaper to find out more, including information on:
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The government has taken key steps to prevent the spread, such as suspending all international flights coming into and out of the country in mid-March, but Sweden’s containment response to the outbreak is being overseen by the Public Health Agency (PHA) rather than the government, with the PHA stating that the country is adopting a mitigating approach and is depending on voluntary approach by the public rather than enforcing severe lockdown and social distancing measures. To date, the country has recorded around 5,500 cases and over 100 deaths.

Reflecting the lack of strict containment measures, for large parts of the economy and the construction industry this has meant business as usual, with construction works continuing at sites. The Swedish multinational construction company, Skanska AB announced on March 30th that it would aim to keep most construction projects running during the COVID-19 crisis. The company has taken precautions to protect its workers from the spread of the virus, and imposed an international travel ban for all its 35,000 employees, which was put in place at the start of March.

As a result of Sweden’s relatively softer response to the virus outbreak, the construction industry has not been as severely disrupted as it has been in several other Western European countries. Nevertheless, growth in the sector had been slowing at the end of 2019, and the economy is forecast to contract by 2.3% in 2020, according to the latest market consensus (compared to a forecast of growth of 1.2% as per market consensus in February).

Reflecting this weakening economic outlook, and the likely decline in confidence, demand in the residential sector, the largest sector in the Swedish construction industry, is expected to weaken considerably. GlobalData expects overall construction output in Sweden to contract by 4% in 2020, a sharp fall from the 1.5% growth recorded in 2019.

Further downward revisions are likely if the number of infected cases and deaths rise in the future, forcing the government to adopt a much stricter policy with regards to social distancing and lockdowns.

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Free Report
img

Internet of Things set to transform the construction industry

The Internet of Things (IoT) is proving hugely beneficial to the construction industry, allowing different assets and people to be monitored and accounted for across a traditionally fragmented industry. As a result, companies that invest in IoT now promise to make long-term gains in the industry. According to GlobalData forecasts, spending on IoT in construction will reach $9.6bn by 2025. For an industry that has large sites to manage, strict project timelines, hazardous working conditions, and tight profit margins, IoT can create a manageable view of construction sites for project managers, streamline operations, and protect workers. In addition, it allows real-time data streams of assets, automates time-consuming tasks, and ensures employee safety and productivity. IoT integration with equipment manufacturing also has rich advantages for asset monitoring sensors. This, combined with artificial intelligence (AI) can help forecast materials and workers needed during the procurement stage and assist in forecast financing. Read GlobalData’s whitepaper to find out more, including information on:
  • IoT value chain
  • Market size and growth forecasts
  • Mergers and acquisitions
  • Leading IoT adopters in construction
  • Specialist IoT vendors in construction
Don’t get left behind – find out how IoT can fortify your operations and make investments now.
by GlobalData
Enter your details here to receive your free Report.

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