After the covid pandemic in 2022 the annual revenue of the global construction industry has reached 12.74 trillion USD in the next few years, this is a huge number as compared to the projected GDP of the world 96.51 trillion USD. The construction industry has contributed 13 % of total world’s GDP. This is a great indicator, of the global economy. Before the pandemic, the construction sector accounted for 10% of total world’s GDP & 7.7% of total global employment, but in 2022 there are more than 100 million jobs across the globe.
The Construction industry has two main sectors which are known as: –
1) The Real Estate Sector
2) The Infrastructure Sector
Real Estate Sector:
The Real Estate Sector refers to projects such as residential housing, retail, hospitality, and commercial buildings that fulfill the need of individual people & corporations. The main objective of the Real Estate sector is to generate profit and create wealth within the industry.
The infrastructure sector includes projects like roads, highways, railways, airports, harbours, berths, dams, public utility projects, etc. These projects fulfil the needs of the general public and also ensure the overall development of society & economy in general.
Another major difference between the real estate sector and the infrastructure sector is the active involvement of the local or national government.
In the case of the Real Estate sector, there is very little active involvement of the government as a client, Government only involves through the guidelines set for the concerned sector.
But in the case of the infrastructure sector, the Government is involved directly or indirectly through the state or center or through any special purpose vehicle.
Another important fact about the infrastructure sector is that in history the world had used infrastructure projects as an effective tool to create direct or indirect employment so nowadays also the world is using the infrastructure sector for the same purpose, as the construction industry Involves multiple specialist, consultants, engineers, contractors, vendors & service providers which ensures collaboration of the client with different business organizations and hence all employees related to those different business organization get benefitted.
When compared to other industries every rupee or dollar invested in infrastructure projects has the ability to circulate on a large scale and also profits the public on various levels right from highly qualified engineers to illiterate unskilled or skilled construction manpower, The Construction industry has the ability to provide jobs to everybody.
Four countries China, India, the USA, and Indonesia will account for 58.3% of the global growth in the construction industry, which growth is driven by rapid urbanization trends and overall growth in the world population. The migration of a minimum of 2.5 billion people to urban areas is also a primary reason behind the development of the real estate sector as well as the infrastructure sector in urban areas. So, while private individuals & corporate are helping in the development of the Real Estate sector, The Government is developing various infrastructure Projects in urban areas.
The global pandemic disturbed the supply chain ecosystem of the world, which resulted in a massive breakdown in the economy and took out the liquidity of the global economic system this resulted in the loss of jobs which also hampered the growth of the construction industry.
The governments of the two largest populated countries India & China have launched many infrastructure projects for their people which will help in the growth of the Global Construction Industry and will create so many employment oppurtinities.