Construction Industry Is Suffering From Labor Shortage

Written by Alisson Ficher

Published on 05/08/2024 at 17:30

Empresários da construção civil no Brasil enfrentam crise: falta de mão de obra qualificada e alta carga tributária ameaçam o setor. (Imagem: reprodução)

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The Construction Sector in Brazil Is Facing a Perfect Storm. Financial Issues, Bureaucracy, and the Lack of Skilled Labor Are Endangering One of the Pillars of the National Economy.

According to the Construction Industry Survey conducted by the National Confederation of Industry (CNI), the difficulty in hiring skilled or unskilled labor was noted by 24.7% of industry professionals. This issue ranked second among the main challenges facing the sector, behind only the high tax burden, cited by 28.3% of entrepreneurs.

Construction industry entrepreneurs in Brazil are living a nightmare. The difficulty in finding skilled and unskilled labor has become a growing problem, according to the Construction Industry Survey conducted by the CNI. According to the research, 24.7% of industry professionals noted this difficulty, marking an increase of 9.9 percentage points compared to the first quarter.

CNI economist Paula Verlangeiro highlighted that construction industries are unable to attract and retain younger workers, who are opting for other careers. “Construction industries demonstrate that they are not able to attract and retain younger workers as they prefer other careers,” Verlangeiro explained.

ARTICLE CONTINUES BELOW

Besides the Lack of Labor

Besides the lack of labor, the high tax burden continues to be the main obstacle for 28.3% of industry entrepreneurs. High interest rates, cited by 24% of respondents, and excessive bureaucracy, mentioned by 20.1% of industry professionals, complete the biggest challenges faced by the construction sector.

The survey, which consulted 338 companies between July 1 and 9, also revealed that the perception of rising prices for inputs and raw materials was more intense in the second quarter. The index rose from 58.6 points to 61.8 points, indicating a significant increase.

Discontent with the operational profit margin, which stood at 45.6 points, and with the financial situation, which reached 48.7 points, reflects widespread dissatisfaction. Despite an increase compared to the first quarter, the indicators remain below the 50-point line, which separates satisfaction from dissatisfaction.

Access to credit remains a barrier. The index rose from 38.5 to 39.1 points, showing that entrepreneurs still face difficulties in obtaining financing.

Activity Remains Stable

In June, the level of industrial activity remained stable, with the index rising from 47.9 points in May to 49.9 points in June. However, the number of employees fell from 49 points to 48.8 points, indicating a continued decline in employment in the sector.

The confidence of construction entrepreneurs also took a hit. The Construction Industry Confidence Index fell by 1.1 points in July, dropping from 52.9 points to 51.8 points. This decline is mainly related to the Current Conditions Index, which measures the perception of current economic conditions and the company, which fell from 47.8 points to 45.5 points.

The evaluation of the current conditions of their own company also turned negative, with the index dropping from 50.8 points in June to 49.3 points in July. The Expectation Index, which measures entrepreneurs’ outlook, decreased by 0.5 points from June to July, but still remains above the 50-point dividing line, indicating a still favorable outlook.

Despite the difficulties, the intention to invest in the construction industry remained stable at 46.6 points in July. This value is higher than that recorded in July 2023 (46.0 points) and July 2022 (45.0 points), suggesting a slight improvement in willingness to invest.

With the sector facing so many challenges, will the government take measures to ease the tax burden and encourage the hiring of young workers?

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Construction Industry Is Suffering From Labor Shortage

The Construction Sector in Brazil Is Facing a Perfect Storm. Financial Issues, Bureaucracy, and the Lack of Skilled Labor Are Endangering One of the Pillars of the National Economy.

Besides the Lack of Labor

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Construction Industry Is Suffering From Labor Shortage

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Brazil will harvest a record crop of up to 357 million tons of grains, but it does not have the capacity to store a large part of it. The storage deficit has reached the highest level in history and is equivalent to almost the entire production of Argentina.

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