What happened
According to COPE, Spain's housing deficit is critical, with a need for 750,000 homes. Construction has fallen more than 40% over the past year, which worsens access to housing. Pedro Fernández Alén, president of the CNC, highlights the gap between household formation and home building.
Rising construction costs are one of the main obstacles. Fernández Alén stresses that without price revision, developers cannot predict the final cost of a project, which leads to halted developments.
The labor shortage is also a problem, with the number of workers declining since 2007. The average age of workers is high and there is little representation of women and young people, which adds pressure on the sector.
Why it matters to a construction company
Small and mid-sized construction companies are especially vulnerable to changes in costs and labor availability. Unpredictable prices can directly affect the viability of new projects.
The construction market is at a crossroads. The drop in construction and the lack of available housing push companies to adapt or face the possibility of being shut out of the market.
The practical consequence is that construction companies must rethink their purchasing and contracting strategies. Legal certainty and price revision become key factors for project viability.
What changes in day-to-day site operations
Workflow on site is affected by the need to constantly adjust budgets and schedules. Uncertainty over the cost of materials such as aluminum and asphalt bitumen forces companies to be more agile in their decisions.
Quantity takeoffs and payment certificates must be more accurate and faster. Construction companies need tools that let them update prices and adjust line items in real time to avoid unexpected cost overruns.
Site managers and purchasing managers are the first to notice these changes. The pressure to keep costs under control and meet deadlines intensifies, affecting the entire supply chain.
Specific cases
Imagine a construction company that decides to halt a project because there is no price revision. Without a clear forecast, the financial risk is too high. This is an example of how uncertainty can stop growth.
Other companies are opting for more flexible contracts that allow price adjustments during the course of the project. This gives them greater room to maneuver against market fluctuations.
For these strategies to work, it is crucial to have a management system that makes it easy to track costs and schedules. Transparency and communication with suppliers and subcontractors are essential.
Data and context
According to COPE, so far this year aluminum has risen 19%, asphalt bitumen 38%, and energy 37%. These increases make it impossible to calculate a project's total budget accurately.
The construction sector has seen a drop in the number of workers, from 2,800,000 in 2007 to 1,500,000 today. The lack of young and female labor is an additional challenge.
However, the data does not show the long-term impact of these trends. The arrival of new foreign workers and ongoing training could change the labor landscape in the coming years.
Risks and limits
The main risk is rising costs without an adequate price revision. This can lead to halted projects and a loss of competitiveness for companies.
In some cases, investing in new projects does not pay off because of uncertain costs and the shortage of skilled labor. Companies must carefully evaluate each project before committing resources.
Organizational risks include failing to adapt to new technologies and processes. Companies that do not modernize their management systems can fall behind in an increasingly competitive market.
What a company can do now
Companies can start by reviewing their contracts and looking for clauses that allow price adjustments. Contractual flexibility is key to handling market volatility.
It is important to set clear criteria for project selection, prioritizing those with lower financial risk and greater long-term viability. Diversifying suppliers can also help mitigate risks.
A realistic next step is to join free pilots of management software such as Bloqbase, which gives construction companies greater control over costs and schedules on real projects.
Sources
COPE: https://www.cope.es/programas/herrera-en-cope/la-entrevista-de-las-9h-con-herrera/audios/pedro-fernandez-empresario-construccion-construir-edificio-necesitan-24-36-meses-no-revisan-precios-no-preve-costar-aluminio-tres-anos-20260917_3438207.html