China, US, and India – The top three countries will add almost US$2.4 trillion to global growth in construction work done over the next 15 years
Global construction work done will grow over US$4.2 trillion over the next 15 years—from US$9.7 trillion in 2022 to US$13.9 trillion by 2037, we find that in our Global Construction Futures report produced in partnership with Aon and other industry leaders.
China, the US, and India will account for 51% of all construction work done by 2037—underpinning the future economic development of the three countries that account for over a third of the world’s population and economic output.
US activity to be supported by the Inflation Reduction Act and infrastructure spending
Residential construction activity in the US is set to undergo a significant slump, as higher interest rates and construction costs weigh over the near-term outlook. The Inflation Reduction Act is supporting significant manufacturing activity and clean energy as a part of the US efforts towards a green transition while the Bipartisan Infrastructure Bill will support civil engineering work, with significant funding flowing to the power and utilities sector, as well as road and highway construction. Debt levels, however, will constrain the ability of the US to fund infrastructure projects in the longer-term.
China construction growth to slow but remains strong
We expect growth in construction work done in China to slow over the next 15 years as the economy transitions from an infrastructure-led growth model to a consumption-led one. A shrinking and aging population will make this transition more challenging, as a diminished labour force and elevated saving rate hamper consumption growth. We nevertheless expect residential construction activity to exceed US$500bn over the next 15 years, supported by the ongoing trend towards urbanisation and government backed rental housing construction activity.
The slowdown in China will see India become the fastest growing construction superpower over the next 15 years, with average annual growth 3 times higher than the US. Despite the slowdown in China, we expect Chinese construction activity will continue to grow faster than the global average, and thereby exceed the US by a significant margin over the next 15years.
India becomes a global construction powerhouse
Growth over the next 15 years in India alone is expected to be higher than the US as India becomes a near US$1 trillion global construction powerhouse. India is expected to witness a significant urbanisation of its population and has the lowest urban density of the largest economies in the world today. The population of India is expected to outsize that of China. Both are at around 1.4 billion people each today.
Behind our global growth forecasts are the other key trends which we set out and monitor in our Global Construction Service. The service provides comprehensive analysis and quarterly forecast updates for 70 national construction markets, accounting for over 90% of global activity. It also includes detailed forecasts of both new construction and renovations across 19 European countries.
Learn more about the future of construction by downloading the Executive Summary of Global Construction Futures report.
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