Growth returns, but low productivity persists
Russia is slowly rising from recession supported by stronger oil prices and low inflation. Unemployment is low at 5 percent, but about 10 percent among construction workers. Western sanctions over Crimea are likely to remain in place, limiting foreign investment and access to Western funds.
Construction output is expected to increase moderately in 2018. The sector is hoping to benefit from major housing projects and final preparations for the 2018 World Cup. Demand for housing is rising with greater access to housing loans. Meanwhile, local governments, in advance of the World Cup, are working on urban development projects, such as the renovation of streets, squares, parks and other public spaces.
There are major infrastructure projects, including the Turkish Stream gas pipeline to Turkey and the high-speed train line between Moscow and Kazan, work is expected to start this year.
|Market:||Staying the same|
|Cost escalation 2017–18:||4.0%|
|Cost escalation 2018–19:||4.0%|
|Location factor (USD):||48.4|
The construction sector is dogged by low productivity and a changing demography is leading to a declining labour force with more people retiring than youngerpeople joining the workforce. The government has plans to attract more foreign skilled labour to meet the shortages and improve competition in the labour market. In the long term, government is investing in education and trying to implement new technologies.
This content is part of the International construction market survey 2018