The UK construction market is enjoying a strong recovery from the recession, but what is the condition of the wider European market?
Research from Eurostat, the statistical office of the European Union, found that production in construction across June dropped by 2.3 per cent in the Euro area, while EU28 suffered a 0.5 per cent decline in comparison to June 2013.
The fall in production in the Eurozone is a result of building construction decreasing by 0.9 per cent, whereas civil engineering dropped by 0.5 per cent. Across EU28, the 0.3 per cent figure is a result of falls of 0.5 per cent and 0.2 per cent in the same two aforementioned fields.
Hungary (-7.5 per cent), Spain (-2.9 per cent), Romania (-2.6 per cent) and Slovakia (-2.3 per cent) recorded the largest reductions in production, but other areas of the continent fared much better.
However, figures for construction growth in Spain made for more pleasing reading, with the country recording an increase of seven per cent for production in construction.
As well as this, Spain was the EU28 member state with the highest jump in the production in construction over the second quarter of this year.
Considering that Spain was in economic turmoil for many years, these figures indicate the country’s recovery in recent times, which will help to boost the condition of the European construction industry as a whole.
Germany and the UK remain strong
Germany and Britain are two countries that helping to drive the European construction industry, recording increases of +1.2 per cent and +1.1 per cent respectively.
Elsewhere, Poland (+2.7 per cent) and the Czech Republic (+1.1 per cent) are both enjoying growth, proving that the picture is not all gloomy across Europe.
Germany, in particular, is seeing steady improvements to its construction sector, with a study from Euler Hermes showing that the industry is set to grow by 3.5 per cent this year. This will put total sales at €285 billion (£172 billion) by 2015, marking a 5.3 per cent rise.
Thomas Krings, chief risk officer at Euler Hermes Germany, said: “Payment morale in the construction industry is improving, but the risk of non-payment remains high.
“We are anticipating 3 per cent fewer bankruptcies in 2014 and a further five per cent reduction next year. But with over 4,000 cases, the absolute figure in the construction sector is still the second highest in Germany. Nevertheless, the sector is gradually improving, with the number of bankruptcies falling by 23 per cent since the 2009 crisis.”
He added that agriculture is the only sector to record a stronger recovery in the country.
Germany has often been a driver of economic activity across Europe and has the largest economy in the entire continent. It also helped many other European countries to survive the recent economic downturn.