Wydarzenia w SPECTIS
Strong construction growth as building season opens
03 kwi 2023
The February data on economic activity show a continued slowdown of the economy at the beginning of 2023. The value of industrial output sold dropped by 1.2% y-o-y, while retail sales shrank by a whopping 5%. As in January, the rate of construction output growth again came as a positive surprise.
Following a 2.4% increase in January, construction output climbed by 6.6% in February, which is a surprisingly solid figure (especially given a high comparison base of February 2022). The February growth was driven by a 21.5% increase in the segment of civil engineering construction companies, a 4.3% hike reported by specialist construction companies, and a 2.8% drop from building construction companies.
Relatively strong growth of construction output in February is all the more surprising as it was accompanied by substantial declines in the production of such key building materials as cement (-15.6%), prefabricated concrete mix (-26.8%) or lime (-8.8%). At the same time, the growth of bitumen production was still substantial (87%). Data on the production of the key construction materials confirm the trend where civil engineering keeps growing in importance, thus offsetting the downturn in building construction.
Stronger-than-expected growth in the construction industry seen in February can be related to the persistent underestimation of actual inflation in the construction sector by GUS. As a result, strong nominal growth is brought to real levels with too low a price index. Relatively robust growth of the civil engineering construction sector was likely driven by the price adjustment in selected contracts, in particular in the road and railway construction segments.
For more details about the latest trends in the Polish construction industry, check the April edition of the "Construction market in Poland" monthly report.
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