Construction: Business Climate Reaches Record High

In construction the business climate improved for the fourth month in succession in November to reach its highest value since German reunification. While assessments of the six-month business outlook remained at last month’s very high level, contractors assessed their current business situation far more favourably than in October. Machinery capacity utilisation rose to 73.5%, or half a percentage point higher than the comparable figure for the same period last year. In line with last month and the same period last year, 26% of survey participants reported constraints on construction activity to date. The largest share of participants (14%) cited a lack of orders as the main constraint; while 8% of companies complained of a lack of qualified staff. Negative weather conditions played virtually no role. The average order back log fell to 2.9 months across the various segments of construction (November 2014: 2.8 months). On balance, almost 13.5% of the firms surveyed assessed their current order intake as too small, versus 21.5% a year ago. According to firm reports, price increases were implemented slightly more frequently. Survey participants also expect scope for further price increases to grow in the near future. Contractors’ willingness to recruit additional staff over the next three to four months rose again markedly in November, climbing to its highest level since December 1991.