The construction industry in Stockholm is hit hard by economic headwinds

The construction industry in Stockholm is hit hard by economic headwinds

STOCKHOLM, Feb. 17 (Xinhua) — Rising construction costs combined with interest rate hikes would worsen the housing shortage in the Swedish capital, while the construction industry expected an increase in the number of bankruptcies and layoffs, Swedish media reported Friday.

– The housing shortage will worsen, says Stefan Westerberg, chief economist at the Stockholm Chamber of Commerce, to Dagens Nyheter (DN) with reference to the results of their latest business survey.

According to their “Stockholm Barometer”, the outlook for the construction sector grew increasingly gloomy as the majority of the city’s construction companies were pessimistic about the coming year, Westerberg said.

“This puts the construction companies in a difficult situation.” He added.

That view is shared by Sweden’s Construction Industries, DN reported.

– There will likely be an increased number of bankruptcies and layoffs (among construction companies), says Fredrik Isaksson, chief economist at the trade association, to DN.

The Stockholm Chamber of Commerce has repeatedly warned that the lack of housing in Stockholm means that companies in the region have difficulty attracting new talent.

According to a report released by the business organization last May, a third of the 500 largest companies in the Stockholm region cited the housing shortage as one of the main reasons behind their recruitment challenges.

In the European Commission’s economic forecast released on Monday, Sweden’s economy is the worst in the EU and is predicted to shrink by 0.8 percent in 2023.


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