Construction: Business Climate Cools Down Slightly

The business climate indicator in construction declined somewhat in June. The contractors surveyed assessed their current business situation more cautiously than in recent months. Their six-month business outlook, by contrast, remained positive. Capacity utilisation dropped by half a percentage point to 79.4%, but remained above the figure for the same period in the previous year of (78.2%). Around 30% of survey participants reported constraints on production as a result. Most of the contractors surveyed (19%) complained of a lack of skilled workers, which is the highest ever figure measured. Lagging a long way behind this was followed by a lack of orders (5%) and negative weather influences (3%). Material shortages were also an important topic among contractors. The survey figure was very low at 3%, but this constraint has become markedly more important since spring 2017; and reached its highest level this month since the end of 2006. The order backlog remained at 4 months in June, versus 3.6 months for the same period last year. According to company reports, price increases were implemented somewhat less frequently. But contractors are more optimistic about the potential scope for price increases in the months ahead. Fewer of the contractors surveyed now expect to recruit additional staff. At the same time, this figure remains at a very high level.