Despite the trailing sky of Covid-19 and the outbreak of war in Ukraine, 2022 stands out as a good year in terms of construction activity.
Building permits for new housing will rise by 3,1% in 2022, which masks a surge of 11,7% in the collective and a decline of 7,1% in the individual. The FFB, however, expects a 1,9% drop in housing units started in 2022, to 394 units. In fact, after a first half of the year driven by the momentum of 000 and expectations of the entry into force of RE2021, the second will suffer from the deterioration of the general situation. Overall, thanks to this fairly good start to the year, particularly in the individual sector, the production in volume of companies will show an increase of 2020% in 5,1.
After two years of slump, new non-residential will finally experience a rebound in activity. In fact, authorized and started surfaces will show increases of 6,2% and 4,9% respectively in 2022. Industrial buildings (including logistics premises), commercial premises and offices will show the strongest increases. For the first two segments, surface areas started will increase by 15,6% and 13,1%; authorized surfaces of 6,9% and 28,2%. For offices, the shift is more recent and will only concern permits, up 18,5%, while surface areas started will fall further by 7,5%. Excluding the price effect, new non-residential activity will grow by 6,6% in 2022.
As for improvement-maintenance, the year turned out to be mixed. The FFB retains an increase in turnover of 2,1%, but hoped for much more. The general context, but above all the crisis in the CEE market and the premature end of the tax credit in favor of the energy renovation of the premises of VSEs-SMEs, came to counterbalance the growth of MaPrimeRénov' and the effects of the recovery plan in terms of renovation of state buildings.
Overall, building production will rise by 3,7% in 2022, excluding the price effect. This is slightly less than the 4,3% initially forecast at the end of last year and the level of pre-health crisis activity remains to be achieved.
Employment in the sector will increase by 15 jobs in 000, including interim full-time equivalent jobs. After integrating self-employed artisans, the building will therefore have 2022 more workers than in March 94.
The result is a downward trend in productivity, due in large part to the disorganization of construction sites resulting from the pandemic, then to supply difficulties. It is also reflected in a shock to cash flow, and therefore in the weakening of companies, while the reimbursement of PGEs has begun.
The beginning of a new construction crisis in 2023
The FFB assumes a modest GDP growth of 0,4% in 2023. Assuming no further panic in energy prices, inflation should ease in the second half, bringing it down to 4,3% in annual average. The credit market should however remain under tension, with real estate interest rates a little above 3% on average over the year, a rate of wear and HCSF rules continuing to bite, and finally heightened caution on the part of credit institutions in the face of a rather uncertain European and global situation.
The decline in housing permits would then turn into a collapse of 21,3% in 2023. In fact, while sales fell by more than 30% in the individual and nearly 15% in the collective in 2022, the environment retained does not allow compensation to be envisaged in 2023. The impact on housing starts would be observed immediately, with an overall decline of 8,6%, and even 13,1% in individual housing. Given production times and the current level of order books, i.e. a little over 7 months on average for all sizes of companies, all territories and all businesses combined, the associated activity would however "only" decline by 2,6. XNUMX%.
In new non-residential, authorized areas are expected to decline, to -0,8%. The decline would be even more marked for administrative buildings, at -2,5%, local authorities favoring the renovation of the existing stock. Nevertheless, the dynamics of permits noted in 2022 should drive housing starts in 2023, which should be up by 2,7%. Production would then rise by 1,7%.
For improvement-maintenance, the FFB expects a fairly rapid increase in energy renovation, at +2,6%. It will be driven by MaPrimeRénov', a CEE market which has recovered, the return of the tax credit for the renovation of TEP-PME premises, the school renovation plan announced by the President of the Republic during the " 24h du bâtiment” and a context more favorable to energy savings. However, this favorable development should be offset by a fall in non-energy works, in an environment encouraging caution. These two components added together, improvement-maintenance activity should be up by 2% in 2023.
Overall, despite the onset of the new housing crisis, building production should show a slight increase of 0,7% in 2023, excluding the price effect, i.e. still 0,8% below the 2019 level. It should also be noted that the new housing crisis could set in over time, following the fall in permits expected for next year.
Given the past overhang of employment over activity, the workforce should stabilize in 2023, including temporary workers in full-time equivalent jobs. Especially since recruitment difficulties would intensify.
There remains the question of the evolution of claims in the building sector, largely conditioned by that of the costs borne by companies, again oriented sharply upwards.
Unemployment insurance, avenues for reform
With regard to the unemployment insurance scheme, the FFB supports the avenues of reform in progress. The French compensation system is much more favorable than many foreign systems if we take into account the level and duration of compensation, and that's good. Nevertheless, reforms are essential. The deficit of our pension scheme reached €64 billion at the end of 2021 and the unemployment rate remained at 7,3%, while in most sectors, companies are having great difficulty recruiting.
We thus support the reduction of the duration of compensation by 25% when the labor market is buoyant and allows an easier return to employment. On the other hand, it is justified to maintain the duration of compensation if the economic situation turns out to be less favorable to finding a job. This counter-cyclical effect will make it possible to maintain a balance between protecting job seekers and encouraging them to return to work aimed at reducing recruitment difficulties.
We are also in favor of assimilating a "post abandonment" to a resignation and therefore of not allowing compensation, but also of suppressing access to unemployment benefits in the event of repeated refusal of a permanent contract to the result of a CDD or a temporary contract on the same position, during the last twelve months.
Asylum and Immigration Bill
Finally, the FFB is closely monitoring the “Asylum and immigration” bill.
Given the recent declarations of several ministers, as well as the elements at our disposal, a "job in tension" residence permit seems to be envisaged. The FFB takes note of this orientation, our profession being very job-creating. However, it would still be necessary to distinguish the case of a person who carried out a professional activity in a regular situation and has not had his residence permit renewed from that of a person who has always been in an irregular situation.
The Federation would like the learning of French not to be financed by companies alone, even though these companies already make a large contribution to the various vocational training schemes.
It is also essential to ensure that people who can benefit from a “short-term occupation” residence permit have the skills required to work on construction sites; the simple fact of intervening on a construction site in an irregular situation cannot ensure this.
In addition, the FFB recalls its proposal, made during the Assises du BTP, to limit cascading subcontracting to two or three levels. Beyond that, in fact, the multiplication of stakeholders can ultimately favor situations of illegal work.
The Federation is also renewing its request for increased monitoring of construction sites, especially in the evening and during weekends. The Carte BTP, which has been in place for several years at the instigation of the profession, facilitates this control. All employees who “carry out, direct or organise, even on an occasional, secondary or incidental basis” building or public works must have it in their possession.
Finally, it would be important to respond, in the draft law, to the problem of the right of residence of young foreigners who have benefited from an apprenticeship contract and justify employment when they come of age, a measure taken by the FFB during the legislative elections of June 2022.