Construction Trades: Between Economic Optimism and Attractiveness Deficit

Article written following the Ipsos x Episto study on a population of construction craftsmen. It was authored by the Ipsos teams: Damien Barnier (Department Director, Market Strategy & Understanding), Florence Léandre (Study Director, Market Strategy & Understanding), and Pierre-Antoine Lacroix (Study Director, Market Strategy & Understanding).

Favorable Economic Outlook Clouded by Lack of Attractiveness

Economically, 90% express satisfaction with their company's activity level for 2023 (with 38% stating 'very satisfied') and anticipate it will remain stable or even increase in 2024, with 40% expecting either scenario. The most optimistic respondents are observed to be in the renovation sector.

However, while this dynamism generates demand – 51% of surveyed companies are looking to recruit (with 34% in the short term) – the appeal of construction trades remains particularly low, with 89% stating that finding labor is difficult (60% even consider it 'very difficult'). Concurrently, it is crucial to remember that engaging an RGE-certified craftsman is mandatory to qualify for energy renovation subsidies. If fewer RGE professionals are available, French consumers may postpone projects or opt for the cheapest alternatives.

This deficit in attractiveness notably raises the issue of valuing craft trades, primarily within the educational system. For 54%, this translates into a lack of candidates, while 65% also believe that candidates lack skills while being overly demanding: 28% find salary expectations high.

The issue of pricing proves central, both for sourcing quality materials (the most important criterion for purchasing tools, supplies, etc.) and for ensuring sufficient margins to adequately compensate employees. This intersects with the two major concerns for construction craftsmen in 2024: the cost of raw materials and fuel, ranking #1 and #2 at 65% and 42% respectively.

An Inevitable Environmental Awareness Requiring Support

Declining demand (37%) and employee management (36%) follow, alongside the environmental dimension, which presents both opportunities and constraints. On one hand, the government aims to accelerate the energy transition, benefiting craftsmen; on the other, regulations such as RE2020^[1] (which considers environmental performance in new construction, from the worksite to the building itself) impose new standards.

Consequently, 75% of construction craftsmen consider environmental issues important for their company and activity, and 81% believe their consideration will increase over the next 5 years, with construction waste management representing the #1 challenge, followed by material composition and energy consumption. They require support, and 92% of construction craftsmen believe that at least one of their partners, brands, manufacturers, and distributors is legitimate to provide this assistance.

If there is one key takeaway from this study, it is the perception among construction craftsmen of being in a paradoxical situation: a rather favorable economic outlook contrasted with poor attractiveness, despite their need to recruit.

A rather encouraging sign: in its latest note for February 2024^[2], the Banque de France reported a slight decrease in interest rates compared to January (settling at 4.11%) for individual housing loans. This marks a first in two years as banks attempt to revitalize demand. Furthermore, the availability of loans, coupled with the quantity of housing units to be renovated by 2050 (20 million^[3]), offers exceptional prospects that warrant capitalization.

‍

[1] Environmental Regulation RE2020 | Ministry of Ecological Transition and Territorial Cohesion (ecologie.gouv.fr)

[2]https://www.banque-france.fr/fr/publications-et-statistiques/statistiques/panorama-des-prets-lhabitat-des-menages-fevrier-2024

[3] https://www.anah.gouv.fr/presse/rentree-2024

‍

Download the infographic

‍