Introduction
Construction industry is a major contributor to the economic growth of a country. The industry not only provides direct employment to millions of people across the world but also creates a huge ripple effect as higher spending and investment opportunities are generated. In the EU, the construction industry has experienced rapid growth in the last few decades, fuelled mainly by the rapid growth in the housing and real estate sector. Construction companies have also grown significantly in size, with many becoming multinationals with operations in multiple countries. This is especially the case in the EU, where the construction industry is one of the largest contributors to the GDP.
Statistics show that the number of construction companies in the EU has grown by nearly 50% in the last 20 years, with the total number reaching almost 20,000. Out of these, 71% are small enterprises, which employ one to ten people, with the remaining firms being either medium or large enterprises. In terms of market share, the construction industry accounts for 89.6% of all market capitalization in the EU. In terms of economic value, the construction industry generates €919 billion of value-added, making it the second largest contributor to the EU economy.
As far as productivity levels are concerned, the construction industry has been lagging behind the productivity levels of other industries in the EU. In 2011, the output of construction firms was the lowest compared to other sectors in the EU, clocking in a productivity of only €15.8 billion. This can largely be attributed to the use of archaic technology in the construction industry as well as inadequate investment in R&D.
An interesting observation is that the construction firms in the EU tend to prefer to work within their own national borders. This suggests that inter-regional cooperation and collaboration are not as common in the industry as it is in other sectors. This could be due to the lack of standardized procedures and regulations across the continent, as well as the language and cultural barriers that exist in different parts of the EU.
Conclusion
Overall, the construction industry in the EU has seen robust growth in the last few decades, with the total number of firms increasing by nearly 50%. The industry accounts for nearly 9% of the total value added in the EU and is the second largest contributor to the economy. However, the industry still lags behind in terms of productivity levels, due to outdated technology and a lack of necessary investments. Furthermore, the firms tend to prefer working within their own countries, due to the language and cultural differences that exist across the continent.
