The global construction sector is expected to grow by 2.3% in 2025 and 3.3% in 2026, driven by infrastructure investments and economic recovery. However, it faces significant challenges, such as the Chinese real estate market crisis, which lowers project demand, and high interest rates in Europe and the United States, slowing down investment in new constructions. Nevertheless, lower inflation and potential interest rate cuts could ease these pressures in the second half of 2025.
Beyond economic factors, the sector is also struggling with a shortage of skilled labor, causing project delays and increasing labor costs, particularly in European countries like Germany and the United Kingdom.
To tackle these issues, the industry is embracing digitalization and innovative methods such as modular construction and prefabrication, which streamline timelines and cut costs. There is also growing pressure to reduce the sector’s environmental impact, as construction accounts for a significant share of global energy consumption and CO2 emissions.