Overall construction activity

In 2022, GDP increased by 3,5% in both the eurozone and the EU as a whole, after a growth of 5,3% and 5,4% respectively in the previous year. Russia's war of aggression against Ukraine has significantly impacted global supply chains and reinforced global inflationary pressures. The EU’s geographical proximity to the war and its dependence on Russian energy resources leaves it particularly exposed to the effects of the conflict. As such, early forecasts for 2023 were pessimistic. Nevertheless, in 2023, the EU’s GDP is expected to expand by 0,8%, a stronger growth than initially expected, and inflation will be lower than in forecasts made towards the end of last year. 

Rising prices and supply shortages for energy and certain construction materials have negatively impact several contractors in Europe, with many at risk of not being able to fulfil contractual obligations or refraining from participating in public tenders. The sustained high energy and raw material costs have a negative impact on production levels, potentially slowing down construction works. Nevertheless, the total investment in construction increased by 2,0% in 2022, not too far off than what FIEC had initially projected (+2,2%). For the second year in a row, Italy (+12,1%) registered the largest increase in investment while Bulgaria registered the sharpest decline (-23,1%). 

The outlook for 2023 is more pessimistic with investment in construction in Europe expected to fall by 2,5%, with all segments expected to contract expect for civil engineering. Sweden is expected to be the country hit the hardest, with investment in construction expected to fall by 13,7%, while Portugal should be the best perfomer with an expected growth of 3,4%.  

In terms of employment, the sector employed 11,1 million workers in 2022, a decrease of 4,0% compared to 2021.

GDP 2022




Total investment in construction in 2022



New housebuilding represents 20,6% of the total investment in construction. It was one of the main drivers of the overall increase in construction investment in 2021, when the sector was still recovering from the effects of the Covid-19 pandemic, but has declined by 0,2% in 2022. This drop is mainly due to significantly weaker growth recorded in France (+2,7%) and Italy (+4,5%) compared to the previous year as well as to a decline recorded in Germany (-3,0%). 

The outlook for 2023 is not much better, with markets in several countries, including some of the EU’s larger Member States, forecasted to contract. Overall, investment in new housebuilding is forecasted to decrease by 3,2% with the largest drop expected in the Sweden (-42,4%). Significant drops are also forecasted for the Czech Republic (-25,8%), and Denmark (-20,3%).


Investment in renovation represents 29,9% of total investment in construction. Having proven to be the least volatile segment over the last decade and having served as a stabiliser in the aftermath of the financial crisis from 2008, investment in renovation works went up by 2,8% in 2022, higher than initially forecasted (+1,2%) and was the strongest of all segments. Investment in renovation is most significant in Italy, with an increase of 22%, significantly higher than the second-best country Denmark (+8,1%). Nevertheless, investment in renovation is expected to slow down significantly, contracting by 3,6% in 2022. It should be noted, however, that this segment has the potential of becoming substantial driver of growth for the construction sector in the longer term as the renovation of buildings is being put at the heart of European and national climate policies.

Non-residential construction

Non-residential construction – such as the construction of offices, hospitals, hotels, schools, industrial buildings – is the largest segment, representing 31,7% of total investment in construction. In 2022, this segment registered an increase of 2,1%, in line with what FIEC had projected last year. The increase in investment in non-residential construction was highest in Ireland (+13,8%) and dropped sharply in Bulgaria (-20,3%). This segment is expected to register a slight decline in 2023 (-1,0%).

Civil engineering

In 2021, civil engineering proved to be the strongest in comparison to the other segments, with investment rising by 9,2%. This is not the case for 2022, however, with investment increasing by only 2,2%. Looking at countries individually, a strength growth rate was recorded in Spain (+23,4%) with lower but signficant growth rates registered in countries such as Denmark (+8,0%) and the Czech Republic (+7,1%). On the other hand, a decline was registered in several markets, notably Bulgaria (-26,5%) and Ireland (-18,9%). 

In 2023, investment in civil engineering is expected to increase by 2,2%, making it the only market segment expected to grow. The implementation of large infrastructure projects may have a stabilising effect within the segment. A strong growth rate is forecasted for Italy (+25,0%) while investment is expected to decline in France (-2,0%), Germany (-1,9%) and Spain (-5,0%). The evolution in the longer term will very much depend on the economic climate. Risks can especially be associated to budget cuts of local and regional authorities, which account for a significant share of investment in civil engineering and companies, and soaring construction costs preventing many contractors from bidding for projects.

Prices of construction materials

The Covid-19 pandemic caused significant disruptions to global supply chains, with several contractors experiencing delays in the delivery of products. The ongoing war in Ukraine has further strained the supply of certain raw materials, especially steel, in Europe and price increases for construction materials are being observed across all EU Member States. 

Looking at certain construction materials individually, prices for steel and bituminous products peaked in most EU countries around mid-2022 and dropped towards the end of the year. Meanwhile the prices of cement have been gradually increasing over the past year. Indeed, a sharp hike in energy prices has been observed across the EU since 2021 and energy-intensive industries including concrete and cement tend to pass on the impact of higher prices to contractors.

European Union*



 Gross value added



Total construction 







New housebuilding





Non residential 



Civil engineering 



Total employment in construction*