- The residential building construction process remains in its initial stages.
Cranes instead of construction cranes. In Mecklenburg-Vorpommern, requests for road repairs and cable installation continue to keep construction companies occupied, while the residential construction sector remains slow-moving. "The construction industry is seeing benefits from seasonal contract awards in civil and road construction. However, there's a lack of orders for high-rise and residential construction companies," explained Joern-Christoph Jansen, the managing director of the state construction association, in Schwerin.
The number of building permits issued in the state continues to decrease. As per Jansen, only 365 single-family and 92 two-family homes were approved during the first half of the year in MV, around 50 percent less than in the same period last year.
Economy is the primary consumer
According to the construction association, the revenue of construction companies with 20 or more employees during the first half of 2024 was a total of one billion euros, 9 percent more than the previous year. However, this growth might be due to rising construction costs and higher wages. The number of work hours was more than 3 percent lower than the previous year's level.
The most profitable sector, with 456 million euros, was once again the industrial construction sector, which saw a growth of almost 17 percent compared to the previous year. Publicly funded construction recorded a revenue of 359 million euros, with a growth of 14 percent. The residential construction sector remains a pressing issue. In this sector, revenue was around 10 percent below the already low revenue of the previous year.
Order intake creates optimism
However, the order intake for the first six months indicates a visible surge in all sectors. By the end of June, new orders had amounted to 943 million euros, 19 percent more than in the same period last year. Particularly, investments by municipalities, the state, and the federal government are seeing a significant increase, around 25 percent. The public sector plans to spend 411 million euros, mainly for road construction. Demand is also increasing in the residential construction sector. The order increase compared to the previous year is almost 17 percent.
For the statistical surveys, the construction association used data from companies with more than 20 employees. These companies employ approximately half of the state's approximately 24,000 construction workers and engineers and contribute significantly to the industry's total revenue due to their size.
The decrease in building permits issued in MV aligns with the slow-moving residential construction sector.Analyzing the statistics, it's evident that the residential construction sector has the lowest revenue growth, around 10% less than the previous year.
