Central Statistical Office he informedthat last month production was 1.4 percent lower than a year earlier. We are talking about data from construction companies with more than 9 employees. It looks weak, although there are reasons to look at these data optimistically. The drop was lower than in June, when production fell by almost 9 percent year-on-year, and lower than experts expected, who expected a deeper drop: to -2.1 percent.
The situation with Polish construction is bad, but not tragic.
So let's start the analysis of Thursday's data with these positive numbers. Looking at the individual construction sectors, let's note that in July, among entities dealing with specialist construction works and construction of civil and water engineering structures, an increase in construction and assembly production was observed, respectively, by 3.7 percent and 0.8 percent year-on-year. What's more, construction and assembly production also increased by 4.5 percent compared to the previous year for investment works.
The increases can also be overstated by comparing the Central Statistical Office data month to month. “Compared to June 2024, construction and assembly production increased among entities performing specialist construction works by 7.5% and in enterprises engaged in the construction of buildings by 3.6%,” we read in the report.
There is more bad news from the construction industry. Construction companies recorded a decrease in production by 8.3 percent compared to July of the previous year. In turn, for wash In the case of renovation projects, production decreased by 11.0 percent in the same period. Month-on-month construction production decreased in entities whose core business was the construction of civil and water engineering structures: by 4.2 percent.
Experts comment on the data. No sadness, but champagne bottles are still corked
Despite everything, experts interpret these data quite positively. “The beginning of the third quarter at first glance was relatively successful for the Polish construction industry,” analysts note. Alior Bank. According to them, we should be happy that construction and assembly production declined the slowest in 2024. The current year is considered a “waiting year” by most companies in this sector.
“The sector is still suffering from the transition period between the EU perspectives and the (temporarily) limited investment appetite of private companies. However, with the launch of projects from the KPO, the situation may reverse towards the accumulation of projects, which will significantly increase activity in the sector, with possible supply constraints and increases price” – PKO analysts elaborate on this.
The prospects for a rebound are therefore very optimistic. “We will have to wait until next year for the results to improve, which results from the length of the construction cycle. In July, 18.6 thousand apartments were put into use, while the construction new The number of starts was 19.9 thousand, with the six-year average being 18 thousand,” experts from the Polish Economic Institute explain.
The data is good, but slightly distorted by external factors
There is also a spoonful of tar in this already small barrel of honey. These data cannot be treated in isolation from the fact that they were data for July. In fact, analysts unanimously note that the main reason for the not-so-bad data is the favorable number of working days in this month.
The Central Statistical Office reported that after eliminating the impact of seasonal factors, construction and assembly production in July 2024 was 5.3 percent lower compared to the same month of 2023 and 0.6 percent higher compared to June 2024. And these are already much less optimistic numbers.