Construction industry fears construction site freezes – and short-time work

The Central Association of the German Construction Industry is sounding the alarm: The current material shortages “have the potential to bring the construction sites to a standstill in the summer”.

A worker removes the provisional lane markings on Unter den Linden in Berlin.

NAfter a weak start to the year, the German construction industry fears delivery problems due to a lack of materials. “The bottlenecks have the potential to bring the construction sites to a standstill in the summer,” said General Manager Felix Pakleppa of the Central Association of the German Construction Industry (ZDB) on Tuesday. “Our companies fear construction site stops and short-time work.”

In the first quarter, the onset of winter and the planned increase in the VAT rate noticeably slowed the construction industry. According to the ZDB, the sales of companies with at least 20 employees in the main construction trade were 16.4 billion euros and thus around 9.4 percent below the previous year’s level. There is light and shadow with the orders: While the demand in residential construction remains high, it continues to fluctuate in the economy.

According to the Federal Statistical Office, total construction investments rose by 1.1 percent from January to March compared to the previous quarter, but fell by 1.6 percent within a year. In May, the business climate in construction brightened, as the Munich Ifo Institute announced in its monthly survey. The companies assessed their current situation better and their expectations were less pessimistic than before.

“However, the problem of material shortages has worsened again,” emphasized Ifo President Clemens Fuest. Construction lobbyist Pakleppa explained: “In the case of plastics and wood, deliveries are often not made, there are significant price increases for steel and metals.”