Covid restrictions will result in 5,000 fewer homes this year

Covid-19 restrictions will have a considerable impact on housing supply this year with up to 5,000 fewer homes being built, a new report has warned.

The study, conducted by EY DKM on behalf of the Construction Industry Federation (CIF), suggests that housing completions will fall to 16,000 in 2021 compared with the outturn for 2020 of just under 21,000.

It also estimates that up to €3 billion will be wiped off the value of construction output this year, following on from a €2 billion hit last year.

The construction sector here is about 40 per cent operational, with all but essential building projects on hold since early January to curb the spread of Covid-19.

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The report noted that the Government’s decision to extend the partial lockdown of the construction industry for a further six weeks until April 5th, means the construction industry will have been shut for 19 weeks since the pandemic started.

“This is giving rise to widespread repercussions for construction firms, construction workers and apprentices, clients, the industry’s supply chain, the economy and society as a whole,” it said.

The report noted that there were 59,867 construction workers in receipt of the Government’s pandemic unemployment payment (PUP) at the beginning of March, almost one in two workers (43.9 per cent) in construction here.

It also highlighted that the value of construction output was €24.7 billion in 2020, which is a reduction of 7.3 per cent or almost €2 billion in construction investment compared with 2019. It estimated that the contraction in 2021 will be approximately €3 billion.

This is based on the assumption that the current partial shutdown ends on April 5th.However, there is speculation the Government may extend this.

Minimal cases

CIF director general Tom Parlon described the shutdown of construction here as "unnecessary".

“HSE monitoring of construction has shown minimal cases since September. This is because the industry can operate at full capacity without contributing to the spread of Covid-19.

"Ireland is the only country to shut down its construction industry, and this is having an number of unintended consequences that again are hugely detrimental and totally unnecessary.

“On a weekly basis I hear from members about the impact of the lockdown on the mental health of our workers. Thousands of workers are now considering leaving Ireland in search of work in any other jurisdiction,” Mr Parlon said.

“This will have significant impact on the medium-term capacity to deliver essential housing and infrastructure for both private and public sectors.”