Czech Construction Industry Faces a Deepening Decline

The construction industry in the Czech Republic is facing a steep decline, with November seeing a year-on-year fall of 6.5 percent. The decline has intensified compared to October, with production falling by 3.8 percent monthly. This data was published by the Czech Statistical Office (ČSÚ), highlighting the impact on land construction.

Radek Matějka, the director of the Department of Statistics of Agriculture, Forestry, Industry, Construction, and Energy at ČSÚ, notes that weather conditions partly influenced the decrease in production. The highest rainfall for November since 1961 was recorded, which could have slowed construction activities.

The most brutal hit was land construction (building construction), which decreased 7.7 percent year-on-year. Engineering construction, which includes road construction, telecommunications, and energy networks, also experienced a decline, dropping by 3.9 percent.

For most of last year, domestic construction production fell in year-on-year comparison. Growth was recorded only twice – in January and June. The first month of the previous year was higher by 5.3 percent, and June saw a slight increase of 0.9 percent. However, a decline was witnessed in the other months, with the most significant drop recorded in April, at 7.1 percent.

In November, 6159 building permits were issued, 11.7 percent less than in the same period last year. The approximate value of permitted constructions reached 41.9 billion crowns, increasing by 0.2 percent compared to November 2022.

The commencement of housing construction in November was in decline, according to statisticians – the year-on-year number of flats under construction fell by 40.7 percent. The number of completed flats also fell by 19.2 percent. Petra Cuřínová, the head of the Department of Construction and Housing Construction Statistics at ČSÚ, stated that the most significant influence on the overall fifth of the decrease in the number of completed flats was due to the category of family houses.