Growth and Challenges in the Global Construction Market

Growth and Challenges in the Global Construction Market

 

According to Next Move Strategy Consulting, the global Construction Market is predicted to reach USD 16 trillion by 2030, with a CAGR of 6% from 2024 to 2030. The construction industry plays an integral role in the global economy, covering everything from planning and design to the maintenance of physical structures. It spans various types of construction, including residential, commercial, industrial, civil engineering, and institutional projects. The industry's stakeholders include architects, engineers, contractors, suppliers, developers, investors, and government agencies, all working together to bring these projects to life.

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Factors Driving Market Growth

Economic expansion is a major driving force behind the construction market's growth. As economies grow, so does the demand for construction projects, including infrastructure, commercial, and residential developments. The rise in disposable income and consumer confidence encourages the construction of new residential properties to meet the growing demand for housing. This trend is further accelerated by an increasing global population and the migration of people to urban areas, driving the need for new residential complexes, commercial spaces, shopping centers, and public infrastructure.

Urbanization demands the development of transportation systems, including roads, bridges, and public transit networks, to improve mobility and connectivity within cities. According to a United Nations report, the global population is expected to grow by 2 billion people by 2050, underscoring the importance of construction in developing sustainable urban environments.

Challenges in the Construction Industry

Despite the growth, the construction industry faces significant challenges, particularly related to government regulations and permitting processes. Projects often require multiple approvals from local, regional, and national authorities. Delays in acquiring permits or changes in regulations can extend project timelines and escalate costs. For example, the U.S. Environmental Protection Agency (EPA) oversees air, lead, waste, and water regulations, all of which impact the construction sector.

North America’s Dominance

North America continues to hold a substantial share of the global construction market. Ongoing mega-projects and government investments are expected to further drive market growth. In 2023, the U.S. government allocated over USD 220 billion to support thousands of infrastructure projects across the country, focusing on modernizing infrastructure, promoting clean energy, and expanding broadband access.

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Key Market Players

The construction market is home to several large-scale players, such as China State Construction Engineering Corp. Ltd. (CSCEC), China Railway Group Ltd. (CREC), and Power Construction Corp. of China, all of which are expanding their reach through investments and strategic collaborations. For example, in 2024, CSCEC and SK Ecoplant jointly invested USD 1.9 billion in a green hydrogen project in Egypt to drive the renewable energy revolution. Similarly, Power Construction Corporation of China completed a floating solar power generation project in Indonesia, helping to reduce coal usage by 117,000 tons annually.

Conclusion

The construction market is on a strong growth trajectory, driven by urbanization, economic expansion, and the increasing need for infrastructure development. However, challenges such as regulatory hurdles and permitting processes may pose obstacles. Despite these, the construction sector is well-positioned to continue its growth, supported by strategic investments, government initiatives, and an ever-growing demand for sustainable urban solutions.

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Next Move Strategy Consulting is a premier market research and management consulting firm that has been committed to provide strategically analysed well documented latest research reports to its clients. The research industry is flooded with many firms to choose from, what makes Next Move different from the rest is its top-quality research and the obsession of turning data into knowledge by dissecting every bit of it and providing fact-based research recommendation that is supported by information collected from over 500 million websites, paid databases, industry journals and one on one consultations with industry experts across a diverse range of industry sectors. The high-quality customized research reports with actionable insights and excellent end-to-end customer service help our clients to take critical business decisions that enables them to move beyond time and have competitive edge in the industry.

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