Construction still on the upside

2009-12-15

The pace of growth of construction and assembly output slowed slightly in October. As a result, the data for the final quarter of this year will be less upbeat than the just released GUS data about value added of the construction industry for Q3 2009. October was the first month in several years to note a drop in wages in the sector. In turn, pace of growth of prices and employment in construction has clearly stabilised.

After the 5.7% increase of September, construction and assembly output noted a slightly lower pace of growth in October 2009 – 2.7%. As a result, in the first ten months of this year, construction and assembly output expanded 4.5% in nominal terms and 4.4% in real terms, to PLN 62.8bn. The October increase resulted from increases in the output of firms specializing in civil engineering works and in erecting buildings. It is worthy to note that while the average employment growth has clearly stabilised, the growth of average wage in the construction sector has slowed decisively in the past two months, falling down to -0.8%.



According to preliminary estimates of GDP for Q3 2009, added value in the construction sector increased 7.2% in Q3 2009 versus 4.6% in Q2 2009, and in the three quarters of 2009 (Q1-Q3 2009) it totaled 5.4%. Construction continued to outperform manufacturing and financial services. The percentage share of the construction industry in generating gross value added in Q1-Q3 2009 was 6.9% – akin to its share in 2008.




Bartlomiej Sosna
Senior Construction Analyst
PMR Publications
bartek.sosna@pmrpublications.com




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