Construction 

Updated: 20.10.2017 - Next update: 24.11.2017
   
 
 
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Volume of building production grew year-on-year

In June to August, the constant-price value or the volume of ongoing building production increased by 7.9 per cent year-on-year. The volume of construction of residential buildings increased in the period by 7.2 per cent and that of other than residential building construction by 8.4 per cent. Measured by volume, at the same time, 17.2 per cent more building projects and 24.1 per cent more residential building projects were started than one year earlier.

Statistical release

Source:
Statistics Finland / Building and dwelling production


Description of indicator

The volume index of newbuilding describes changes in the value at constant prices of newbuilding in domestic building construction from the comparison period or the base year of the index. Newbuilding refers to construction subject to a building permit as a result of which a new building or new space to an existing building is created.

Fluctuations in the economy as well as economic conditions for industry are widely reflected in trends in the level of construction. Sector-specific development and the changing structures of business and industry have a direct impact on business’ and the public sector’s willingness to build and on the planning of new building projects. A consequence of economic instability and a fall in output, moreover, is a decline in the number of industrial and other investments such as newbuilding projects. In addition to investment, growth (or decline) in construction is influenced by trends in interest rates and inflation. The economic effects of construction are not restricted only to the development of the construction industry and its jobs; construction volume is widely reflected in the state of the economy and in forecasts of business demand and growth.

The public sector has a key role in the development of the building industry and construction volume. In addition, the public sector is a significant provider of financing for newbuilding, and it also steers and regulates conditions for construction through legislation, taxation and planning. The public sector’s central role in the planning and preparation of construction projects is justified by the fact that newbuilding volume and the targeting of construction have diverse spill-over effects on the employment rate and on urban structure development.

Newbuilding is divided into housing production and, in terms of industrial construction, into warehouse and manufacturing construction as well as commercial and office construction. The various construction sectors should also be taken into account with different weightings when formulating construction policy. The public sector should support and activate in a sustainable way the building of reasonably priced homes in particular. In addition to this, the public sector should ensure the effectiveness and fair allocation of housing subsidy schemes.

Any examination of construction indicators should play close attention not only to growth in construction volume but also on the numerous socio-political effects of construction policy, as well as on the fact that construction planning is reflected in the diversity of the building stock, the development of house prices, and in the services, infrastructure and vitality of residential areas. Construction has far-reaching environmental and regional policy implications, which creates challenges in the coordination and development of construction planning. In construction there are large regional differences in Finland, which significantly impacts on the growth of urban centres and correspondingly on the infrastructure and urban structure conditions of peripheral areas. The public sector’s goal is to develop in future sustainable and resident-serving housing environments and at the same time to ensure good living conditions throughout Finland.