shutterstock.com shutterstock.com
Construction

Industry Federation gives a gloomy forecast for 2025

The French construction industry continues to experience an unprecedented crisis. According to the industry federation Fédération Française du Bâtiment (FFB), the total volume of construction in the sector in 2024 fell by 6.6% y/y.

The number of new construction sites opened last year decreased by 14.2% y/y after a significant decline of 24.9% in 2023. The decline in new housing construction last year was 21.9% year-on-year, which was the result of an unfavorable economic climate, in particular, persistent inflation, rising interest rates and difficulties in accessing credit.

The volume of new non-residential real estate commissioning in 2024 (excluding the price effect) decreased by 7.4% compared to 2023. At the same time, non-residential construction saw a sharp decline in all segments, except for public buildings, where the situation remained stable.

The FFB gives a gloomy forecast for 2025, expecting a 5.6% drop in volumes in the industry, mainly due to problems with new construction. In particular, new housing construction is projected to decline by 14.2% due to another low in new construction starts.

The non-residential sector will suffer due to general uncertainty and insufficiently attractive lending conditions.

According to the November forecast of the European Steel Association (EUROFER), production in the EU construction sector will decline by 1.3% in 2024 compared to 2023. In 2025, activity in the sector is expected to recover by 1.3% y/y.