Building Sector Pockets Positive Growth by 2025 in Berlin's Bumpy Road to Recovery
Anticipated Rise in Construction Sales: Upto 1% Growth Foreseen Over the Next Five Years (2022-2025) - Anticipated incremental growth of up to 1% in the construction sector by 2025, industry experts predict.
The construction industry plays a pivotal role in the BVB's revenue, representing one-third of the total. Despite a 4% revenue dip the previous year, the latest reports hint at a recovery, albeit slight, with a projected zero growth rate by 2025.
The openings of the year have been quite optimistic, according to Nachbauer. The industry experienced a 12.5% surge in orders in the first quarter, with residential construction adding a promising 16%. However, he warns that we're still not ready to shout about a trend reversal just yet. The low starting point in residential construction and continued feeble permit numbers cast a shadow over the industry's recovery.
Civil engineering, unsurprisingly, is grappling with low utilization rates at just two-thirds, Nachbauer says. He advocates for clarification on the allocation of special assets and the steadfast securing of infrastructure funds within the federal budget for 2025-2026.
Besides residential construction, growth is expected in other areas such as building technology and services (1%), roofing (3%), and landscape gardening (2.5%). The finishing trades, including metal construction, painters, carpenters, and interior designers, anticipate a modest 0.5% increase. The scaffolding industry, however, braces itself for a 2% revenue plunge.
Nachbauer continues to plead for streamlining bureaucracy, pinpointing it as a major hurdle in the construction sector's progress. He also voices concerns over the proposed minimum wage hike, as specified in the coalition agreement, which creeps towards 15.00 euros by 2026.
While specific growth rate projections for different sectors in Berlin are lacking, it's clear that the construction industry in Berlin, like any other city, is navigating its unique challenges on the road to recovery. The residential sector, in particular, faces a tough road ahead given the apparent decline in building permits and completions. However, optimism sparks in the infrastructure and energy sectors, fueled by substantial government investment.
The community should rally behind vocational training programs focused on the construction industry, as it plays a crucial role in Berlin's economy and may require skilled workforce to recover fully by 2025. To secure long-term financing for these initiatives, private and public sectors could collaborate, bolstering the industry's growth potential.
