Material Shortage Has Hit the German Construction Industry
Germany’s construction industry is facing serious material bottlenecks, according to surveys by the ifo Institute. “We haven’t seen a bottleneck like this since 1991. This evidently caused construction activity to slow down in April, at least temporarily,” says Felix Leiss, a survey expert at the ifo Institute.
In building construction, 23.9 percent of companies reported in April that they were having problems procuring construction materials in time. In March, it was 5.6 percent. The shortage in civil engineering worsened considerably in April, affecting 11.5 percent of companies versus 2.9 percent in March. “What we’re hearing from the industry is that there are material shortages in many places. At the same time, prices have risen due to supply difficulties in several markets: for example, construction steel, lumber, and synthetic materials such as insulation and sheeting,” says Ludwig Dorffmeister, an ifo Institute expert on the construction industry. He said it is likely that capacity had been scaled back because of the coronavirus, but then demand picked up faster than expected. Special factors in production may also have played a role, such as the onset of winter in the US, which delayed lumber production, processing, and transportation.
