The volume index of production in the narrow construction sector increased marginally, by 2.3% over the 2015-2018 period. The production in building construction increased slightly by 1.1%, while civil engineering construction experienced a higher growth of 6.1% over the same period.
Similarly, the total turnover in the broad construction sector increased moderately by 9.9% from EUR 419.9 billion in 2010 to EUR 461.6 billion in 2018. During the 2010-2017 period, the apparent labour productivity of the broad construction sector also increased by 10.5%.
The total employment in the broad construction sector declined by 2.2% in 2018 compared to the 2010 levels. This was mainly driven by a decrease of 4.3% and 7.0% in number of employees in the narrow construction and manufacturing subsectors, respectively for the same time period.
Since 2015, housing prices have started picking up for existing and new dwelling, reflecting a housing demand increasing faster than the supply. In fact, the issuance of building permits for residential buildings has declined by 4.1% in 2018 compared to 2010.
In accordance with the Construction Revival Plan, several schemes promoting home-ownership have been introduced (such as the Zero-interest Loan, Social Access loan) and were recently amended to promote to the acquisition of new housing, especially by young people.
Despite the above favourable developments, the French economy is expected to slow down, which may impact the development of the construction sector. In addition, some key issues, such as labour and skills shortage and the relatively low profitability of the sector, will need to be addressed to ensure the sustainable development of the sector.