Construction recorded its fourth downturn in a row in November 2022
The industry recorded in November of last year a slight rise of 0.8% compared to October. While construction recorded its fourth consecutive drop in the same period, falling 0.5%. The data, which for analysts confirms a worrying behavior of both sectors in 2022, was published yesterday by the National Institute of Statistics and Censuses (Indec), which also reported that manufacturing activity grew 1.4% in November compared to the same month. 2021, while the construction sector fell 1.5%.
In year-on-year terms, that of the industry was the tenth consecutive increase in the indicator, but the lowest since January 2022, which shows a slowing trend in the rate of expansion, according to economists.
In November, year-on-year improvements were observed in 10 of 16 industrial branches. The production of clothing, leather and footwear (8.6%), the metal industry (5.6%) and automotive production (7.3%) stood out.
According to INDEC data, manufacturing production grew by 5.2% in the first 11 months of 2022.
The most worrying data produced by the official record came from the construction side, which, with the fall in November, has been retracting for four consecutive months and fell 1.5% in relation to the same month in 2021. Inasmuch as the level of Activity in the sector accumulated a rise of 4.8% in the first 11 months of last year, making it five consecutive months in which the accumulated annual figure has fallen, from the peak of 6.5% expansion in June.
“In the case of construction, four months of consecutive decline have already accumulated, something quite worrying. In industry, there is some recovery after two months of decline, which may be due to the fact that in November the brake on imports probably eased a bit,” explained economist Camilo Tiscornia, for whom “last year’s behavior has not been good and both industry and construction show the same”.
The same is observed by the economist Natalia Motyl, when assuring that also in the industry, despite the rise in November, a recessive trend would be verified, since this segment is far from the values of the second quarter of 2022: “Today the sector is finds itself stagnating,” he warned.
“Since December, several key sectors have been warning about the lack of basic supplies. There is not much to celebrate and as of December we are going to feel the lack of inputs due to import restrictions, macroeconomic instability and the uncertainty of an election year,” added Motyl.
Regarding construction, the economist diagnosed that “many find their works paralyzed because when the dollar jumps they withhold inputs to adjust when the exchange market stabilizes; something that is added to the lack of inputs from abroad derived from the obstacles to imports. On the other hand, the fiscal adjustment generates a lot of uncertainty in the public works sector”.
For Lorenzo Sigaut Gravina, from the consulting firm Equilibra, “the trend continues to indicate that since June the industry entered a recessive process. In the case of construction, the signs are more recessive, because it shows a seasonally adjusted year-on-year and monthly drop, compared to October. Here, the recession also started in June but it became more acute”.
