INTRODUCTION:

The construction Industry has been hailed as the back-bone of many economies, in part or as a whole. It adds in large parts to the GDP of a nation and as a whole enables trade and encourages growth. It currently contributes about one- tenth (1/10) of the world’s GDP. ‘The total global AEC (Architecture, Engineering and Construction) market is about $7.2 trillion and expected to grow to $12 trillion by 2020’ (Global Construction 2020. http://www.globalconstruction2020.com/).

The Construction industry provides employment for about 7% of the total global employed work force. It also accounts for being the largest energy consuming sector globally where it is recorded to consume about 2/5th of the total consumed energy worldwide and it is responsible for about half the total resources used worldwide. (http://www.economywatch.com/world-industries/construction/trends.html#sthash.8UZZiQEb.dpuf)

This technical report examines the sum and a specific part of the industry. Looking at factors; Political, Economic, Social, Technological, environmental and social that may affect the industry’s growth and the strategic analysis employed by businesses in this industry. This would be done using the PEST analysis and Porters Five Force model when researching the Industry as a whole and the SWOT and Portfolio Analysis in researching a specific part.

Being a multi-trillion global industry, it remains an attractive competitive industry where managers must strategically manage their individual companies as it is a project centred industry characterized by short-term partnering between a range of teams with varying levels of Industry experience, information and communication technologies’ capability. To remain competitive, managers must ensure they have effective strategies to continue to win work for their project centred businesses.

The CONSTRUCTION INDUSTRY:

What is the construction Industry? The business dictionary online defines this as; “The Sector of national economy engaged in the preparation of land and construction, alteration, and repair of buildings, structures, and other real property.”

It is an industry known worldwide for operating on narrow profit margins (P. 51 Anthony E Henry. Understanding Strategic Management) and it constitutes one of the most important sectors in any countries national economy. It can be split into three broad categories: Architecture, Engineering and Construction;

– The construction of heavy and civil engineering which covers the construction of railway tracks, bridges, highways, tunnels , airport and other functional capital intensive ventures.

– The construction of real estate which covers both commercial and residential buildings.

– And, the construction of specialized items; pipelines, electrical equipment, decorative materials, and the likes.

It is considered as being the world’s single largest industrial employer. Estimates of its size and importance vary from country to country. (http://www.cnbc.com/id/100419943/Research_and_Markets_Analyzing_the_European_Construction_Industry_2013)

The construction industry like most other industries is affected by a nations financial crisis as government cuts in spending and other factors such as population growth, material costs, climate, urbanisation, globalization and technology can have their direct and indirect toll on the industry.