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Irish construction suffers record 45% contraction in output

Fall-off in activity as a result of coronavirus was nearly four times bigger than euro area average

The Central Bank is now predicting just 16,000 housing completions this year, instead of 26,000.

The Irish construction industry has suffered its worst quarterly decline on record, with output slumping by 45.2 per cent between April and June, according to the Central Statistics Office (CSO).

This was nearly four times the euro area average of 12 per cent, and worse than anything seen at the height of the 2008 property crash.

The three-month period coincided with the imposition of restrictions to curb the spread of the coronavirus, resulting in the closure of nearly all outdoor building sites.

The CSO said the largest quarterly decline prior to this was a decrease of 13.9 per cent in the fourth quarter of 2008.

The figures show the residential sector suffered the largest quarterly decrease with output falling by 50.9 per cent, while the non-residential and civil engineering sectors both decreased by 43.7 per cent and 42.5 per cent respectively.


The fall-off in residential construction is expected to curtail the supply of new homes, potentially aggravating the State’s ongoing housing crisis.

The Central Bank is now predicting just 16,000 housing completions this year, instead of 26,000.

Ulster Bank chief economist Simon Barry told The Irish Times recently that the construction sector here would under-perform international aggregates by some way because of the tightness of restrictions imposed during lockdown.He also noted that euro area aggregates for construction are heavily skewed by the bloc’s largest economy, Germany, which only experienced a 4 per cent drop in activity, primarily because it did not have as severe a lockdown as Ireland.

Mr Barry said the sector here was already experiencing a swift bounce back in activity since the lifting of restrictions on May 18th, which saw the reopening of construction sites.

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