Construction industry to bounce back in 2021
South Africa’s construction industry is expected to bounce back in 2021 after being the sector with the poorest performance in 2020.
David Metelerkamp, a senior economist at construction market intelligence firm Industry Insight, is however anticipating “a reasonable bounce back” by the civil industry – though he believes the opportunities for an improvement in the building industry are limited.
Statistics SA data shows that the civil industry contracted by just more than 18% in 2020 while investment in the residential building industry contracted by 20.9% and the non-residential building industry by 25.3%.
Not an ‘essential service’
Industry Insight attributes the construction industry GDP being down by “a crippling 20.3%” in 2020 to the fact that, unlike other countries, the construction industry was not declared an essential service in South Africa during the hard lockdown period in April and May 2020 and the government and the private sector disinvested massively from both the building or civil infrastructure segments of the industry.
Metelerkamp says the civil industry performed slightly worse than forecast in 2020 while the performance of the residential and non-residential sectors, despite being extremely poor, was slightly better than forecast.
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