Sector de construcción en españa

Title
Construction Sector in Spain

Team Matisse
Final Presentation Managerial Economics II * EADA, February 2011

Agenda

1 2 3 4

Construction sector from the 1990s to 2007 Impact of the crisis - 2008 Main players Conclusions

Agenda

1 2 3 4

Construction sector from the 1990s to 2007 Impact of the crisis Main players Main players

Construction sector in Spain from the1990s to 2007

Production growth

Economic growth

Construction sector

Employment growth

Productivity of suppliers

Construction sector in Spain from the 1990s to 2007
Construction sector markets

Civil Work 25%

Residential 35%

Restoration and manteinance 24%

Non residential 16%

* Source: INE (Statistics National Institute)

Construction sector in Spain from the 1990sto 2007
Construction sector contribution to the GDP
Gross value added growth
12.0

Between 1996 and 2007: - Construction GVA grew at 5.1% rate vs. total GVA which had a 3.6% growth - GVA Contribution to the GDP grew from 6.6% to 11% - Construction employment grew at 6.7% (from 1.2 m to 2.6 m) vs. Total employment which grew at 3.2%
1996 1998 2000 2001 2002 2003 2004 2005 2006 2007 200810.0

8.0

6.0

4.0

2.0

0.0

* Source: INE

Construction sector in Spain from the 1990s to 2007
Construction sector productivity
54%

Data
Total internal production (million €) Residential building Non residential building Restoration and maintenance Civil work Cement consumption (thousands of tons) Employment (thousands of people) Housing (in thousands)

2003 33.0% 18.0%25.0% 24.0%

2004 33.0% 18.0% 25.0% 24.0%

2005 34.0% 17.0% 25.0% 24.0%

2006 35.4% 16.2% 24.0% 24.5%

2007 35.5% 16.0% 23.6% 24.8%

2008 193.29

129.31 144.66 165.15 185.96 199.22

46.000 47.610 50.425 55.896 56.081 2.102 622.0 2.253 630.0 2.357 714.8 2.542 865.5 2.697 616.0

42.659 2.135 360.0

* Source: INE

Construction sector in Spain from the 1990s to 2007
Type ofactivities specialized by construction companies
Type of company N° employees Work preparation General Construction Building completion work Construction equipment rental Total Construction In units Total Economy In units
* Source: INE, DIRCE

Small 10-19 50.1% 55.0% 65.1% 36.0% 56.9% 25,545 87.8%

Medium 20-199 48.8% 43.1% 38.5% 34.3% 62.4% 41.5% 18,625 11.8%

Large >200 1.0% 1.9% 1.0% 0.6% 1.7%1.6% 698 0.4% 6,465

Total 1,257 29,788 8,687 4,958 178 100.0% 44,868 100.0% 1,667,865

Buildings and work installations 60.5%

1,465,019 196,381

Construction sector in Spain from the 1990s to 2007
Net companies created

2008 12,648 2007 2006 2005 2004 2003 2002 2001 2000 38,580 30,758 26,083 28,929 22,155 18,650 19,710 19,961 34,053 44,196 55,401 65,673

171,164 127,619 95,85696,472 94,178 Construction companies Other sector companies

25,698 1999 1,452 0 50,000 100,000 150,000 200,000

* Source: INE, DIRCE

Construction sector in Spain from the 1990s to 2007
Housing policies

Context: -Exceptionally reduced interest rates - Increase of debt period - Good predisposition from the financial entities

Consequences: -Rise in house demand and supply - Rise inhousing price - Rise in familiar indebtedness - Creation of a “State Plan 2005-2008”

Agenda

1 2 3 4

Construction sector from the 1990s to 2007 Impact of the crisis - 2008 Main players Main players

Impact of the the crisis - 2008 Impact of crisis - 2008

Economic Environment
• • • • International Financial Crisis – Restriction of Credit Increase of interest rates GDP’s slow downExpectations on the Residential Market – Bubble

Residencial

Rehabilitation

Non Residencial

Non Building

Impact of the the crisis - 2008 Impact of crisis - 2008 Residencial Market
D1

S1

• Level of Demand:
– – – – Social Demographic Economic Financial situation and bad expectations
P1

D2

• Supply
– Rigid – Maturity period 18-24 months
QD QS

Excess of Supply

Impact...