Analysis of construction - 1. quarter of 2007

            In the first quarter of 2007 construction production was strongly affected by exceptionally favourable weather conditions which enabled the builders to perform all kinds of construction work without restraint.
 

• Total construction output was by 28.9% higher than in the first quarter of 2006;
• Building construction contributed most to the growth;
• Average registered number of employees remained at the same level year-on-year;
• Average monthly nominal wage increased by 13.1%;
• The planning and building control authorities granted by 2.6% more building permits;
• Approximate value of permitted constructions was by 25.1% higher.

 
 
Construction output
 
            Total construction output at constant prices was up by 28.9% year-on-year (by 29.7% adjusted for seasonal effects) in the first quarter of 2007. Compared to the first quarter of 2006, volumes of construction work increased in all types of construction, and in building construction in particular.  
 
            The very favourable weather conditions enabled the builders to perform all kinds of construction work without restraint. The growth of output was affected by the implementation of property developer projects of foreign investors focused mainly on administrative and multifunctional centres. Civil engineering grew mainly due to construction of highways and reconstruction and modernization of railways incl. railway junctions.
 

Construction output volume

Construction work worth CZK 90 177 million was carried out in the first quarter of 2007. According to a CZSO estimate, small enterprises (up to 19 employees) produced more than third of the total construction output. The decisive basis of construction was represented by 2 355 enterprises with 20+ employees which performed construction work priced at CZK 55 581 million, i.e. by 28.7% more than in the first quarter of 2006.
 
CZK 48 729 million (+29.0%) was spent on new construction, reconstruction and modernization, and CZK 4 738 million (+11.0%) on repair and maintenance. Construction work abroad grew by 91.4%. Other work was up by 17.0%.

Predominating part of the output (approx. 89%) was produced by enterprises whose principal activity classified them to building construction and civil engineering (growth by 29.4%). The lowest share (roughly 2%), yet the highest rate of growth, was recorded in construction enterprises engaged mainly in site preparation.

From the point of view of the size of enterprises defined by number of employees, volume of construction work grew in all size groups of enterprises. The growth of construction output in two size groups of enterprises (100 - 199 employees and 400 - 499 employees) was even higher than 30%. Above-the-average results were achieved in smaller enterprises below 50 employees and in large enterprises with 1000+ employees.

Broken down by institutional sector (ISECTOR), predominating part of construction output was produced by national private non-financial corporations and foreign-controlled non-financial corporations where the volume of construction work grew by 34.2% and reached roughly CZK 45 million.

 
Construction work carried out by enterprises’ own workers
   
      The trend of the indicator “construction work carried out by enterprises’ own workers” was similar to that of “contracted construction work”. It increased by 26.7% in the first quarter of 2007. 

 
Employment
     
The average registered number of employees working with construction enterprises employing 20+ persons in the first quarter of 2007 was 153.8 thousand (like in the first quarter of 2006), of which 95.3 thousand were manual workers (-1.7%).
Employment decreased in every second size group of enterprises, predominantly in small and medium enterprises. The biggest fall was recorded in enterprises with 200 - 299 employees (–12,4%), the highest increase in enterprises employing 400 - 499 persons (+6.2%).
Building construction and civil engineering employed 124.3 thousand persons (-0.2%), building installation 16.9 thousand (-2.6%) and building completion 5.1 thousand (+3.1%).

 
Wages
   
      The average monthly nominal wage of employees in construction enterprises with 20+ employees reached CZK 20 161 in the first quarter of 2007, which was by 13.1% more year-on-year. Hourly wage was CZK 142, i.e. by 8.6% higher.
The highest wage increase occurred in enterprises with 200 - 299 employees (+15.4%) and the lowest in enterprises with 500 - 999 employees (+6.0%).
Average wage in building construction and civil engineering rose by 13.5% and reached CZK 20 394, in building installation by 10.6% (CZK 20 528) and in building completion by 11.7% (CZK 17 250).
 
Labour productivity
 
Owing to stagnating employment, labour productivity per worker in construction enterprises with 20+ employees increased by 28.7% (like construction output) in the first quarter of 2007. As the number of hours worked was up (+4.1%) year-on-year, labour productivity per hour worked grew less (+23.6%) than labour productivity per employee.

 
Building permits

The planning and building control authorities granted 26 020 building permits in the first quarter of 2007, which was by 2.6% more than in the first quarter of 2006. Most building permits were granted for residential buildings; they increased by 18.9% year-on-year. There were 2 449 building permits granted in Prague, of which over 60% were for housing construction.


Approximate value of constructions
 
The approximate value of constructions permitted in the first quarter of 2007 was CZK 81.1 billion (+25.1% year-on-year). New construction will produce property valued at CZK 58.6 billion (+44.3%). Renewals and enhancements will make available constructions worth CZK 22.5 billion (–7.2%).
By type of constructions, the highest growth of approximate value was registered for non-residential buildings (+59.8%). Approximate value of residential buildings grew by 8.9%, other constructions by 13.6% and environmental constructions by 10.0%.

 
Floor space
    
In the first quarter of 2007 the planning and building control authorities permitted the construction of buildings with a floor space of 1 805 thousand m ². A year-on-year increase was observed especially for residential buildings (+17.3%) and a decrease for non-residential buildings (–19.4%). The floor space of newly constructed residential buildings increased by 23.4% and of renewals and enhancements dropped by 22.0%. The average floor space of a newly constructed dwelling was 126.9 m ² and approximate value CZK 18.3 thousand per 1m ².