Construction sector collapses, more than 20,000 jobs destroyed in first quarter, warns FFB

The French Building Federation sounded the alarm on Wednesday. It estimates that 25,000 jobs have already been cut in the first quarter of 2024 and that this trend will continue throughout the year.

The construction industry has been in a bad way for several months and, according to the French Building Federation (FFB), things are not going to get better. According to it, 25,000 jobs were cut in the first quarter of 2024 and “It’s only a beginning“, warns Olivier Salleron, the president of the FFB, during a press conference on Wednesday July 10. He explains that “If there is no powerful measure, no shock measure, to relaunch the new, 150,000 jobs will be threatened.“, and even, he adds, if we take into account the induced positions, which are therefore linked to the building industry – such as architects, notaries, etc. We must expect to see 300,000 jobs disappear.

These losses are mainly due to the fall in construction starts, down 21% in one year between June 2023 and June 2024. With inflation, household budgets have shrunk. And with interest rates rising in recent years, households have struggled to commit to real estate projects. Particularly in new construction, where at the same time costs have exploded with the rise in raw material prices. As a result, developers have abruptly halted projects and investments. Large groups have downsized, such as Nexity, which announced in the spring that it would be cutting nearly 20% of its workforce.

Despite government aid, schemes like MaPrimeRenov’, which has been refocused, have not been enough. The French have not undertaken enough work, major projects to employ professionals, with inflation, many did not have the means. Emmanuel Macron has also acknowledged that he has not done enough for the housing sector.

However, this is one of the main concerns of households. Moreover, the French Building Federation recognizes that the New Popular Front promises massive investments for the sector, which would be welcome, while worrying that other provisions of the left-wing bloc’s program will damage the economy. In the crosshairs, the increase in the minimum wage of 200 euros, which companies in the sector would not be able to absorb. Above all, the construction industry relies on a large, low-skilled workforce.