Lockdowns and travel restrictions due to COVID-19 disrupted the construction activity globally as construction companies struggled to move workers and materials to site. GlobalData estimates that the sector contracted by a historic 2.5% last year, although it is expected to recover this year by 5.2% provided new lockdown measures are not introduced.
Verdict has conducted a poll to assess the time to be taken for the construction sector to recover to pre-pandemic levels. Analysis of the poll results shows that a majority 58% of the respondents are optimistic about the sector’s recovery within the next two years. While 28% of the respondents are optimistic about the industry’s recovery within the next 18 to 24 months, 30% expect the recovery to be even quicker.
Conversely, 12% expect that the situation will worsen, while 10% expect the current market conditions to prevail throughout 2021.
The remaining 20% of the respondents are neutral stating that the industry has survived the worst although challenges will continue.
The analysis is based on 91 responses received from the readers of Design Build Network, a Verdict network site, between 21 August 2020 and 01 June 2021.
Growth of the construction sector post-COVID
The COVID-19 crisis had a huge impact on the global construction industry in terms of foregone revenue. The construction output value in 2020–2021 was roughly $1.1tr lower than that predicted in pre-pandemic, according to GlobalData. India, for example, was poised to become the third largest construction market by 2025, but the pandemic forced sites to be closed and workers to leave cities. Similarly, the UK construction sector fell into the deepest recession forcing construction companies to furlough as high as 80% of their employees.
Activity in the sector is rebounding positively with output projected to be 2.5% higher than 2019 levels, according to GlobalData. Uncertainty over the pandemic, however, remains as new virus strains and lack of access to vaccines pose a risk for developing markets.
The construction sector may rebound quickly provided governments and public health authorities do not impose additional lockdown restrictions and construction sites are able to remain open without any disruptions, adds GlobalData.
Construction companies are also dealing with worker shortage as construction activity resumes, which could lead to rise in costs. Smart construction technologies such as prefabrication and introducing of technologies such as big data and artificial intelligence (AI) in the design process can help construction companies address these issues, while improving efficiency and reducing costs, according to World Economic Forum.