РЕФЕРАТ
Для сдачи кандидатского экзамена
по иностранному языку
(Английский)
на тему «The construction industry»
Выполнил
Студент магистратуры
Петрашевич Г.В.
___________________
Проверил
канд. филологических наук,
доцент
Нехай Г.В.
___________________
МИНСК 2017
CONTENTS
| АННОТАЦИЯ………………………………………………………………….. | ||
| INTRODUCTION……………………………………………………...……….. | ||
| 1 BUILDING MATERIALS INDUSTRY IN BELARUS……………………… | ||
| 1.1 Characteristics of the building materials industry ………………………. | ||
| 1.2 Building materials and products………………………………………..... | ||
| 1.3 Investments………………………………………………………………. | ||
| 2 THE UNITED STATES OF AMERICA CONSTRUCTION INDUSTRY…... | ||
| 2.1 Key statistics about residential and nonresidential building ……………… | ||
| 2.2. Worker shortages in the U.S. construction industry…………………….. | ||
| 2.3 Headwinds facing the construction industry …………………………….. | ||
| 3 THE UNITED KINGDOM CONSTRUCTION INDUSTRY………………... | ||
| 3.1 The UK construction industry has slipped into recession ……………….. | ||
| 3.2 Referendum impact on the UK construction industry...………………… | ||
| 3.3 Recovery of the UK construction industry ……………………………… | ||
| CONCLUSION………………………………………………………………… | ||
| REFERENCES………………………………………………………………….. |
АННОТАЦИЯ
Строительство распространено по всему миру. Миллионы трудящихся участвуют в процессе строительства. Строительная отрасль является одной из самых востребованных отраслей сегодня, она поддерживает другие отрасли промышленности: отрасль строительных материалов, машиностроение, деревообработка и другие. Строительство, как отрасль, составляет от шести до девяти процентов валового внутреннего продукта развитых стран мира.
Промышленность строительных материалов в Беларуси представлена 1500 предприятиями, которые специализируются на производстве цемента, покрытий для стен и отделочных материалов, сборных железобетонных и бетонных конструкций, кровельных материалов и т.д. В стране производится более 130 видов строительных материалов и изделий. В 2005-2010 годах объем инвестиций в строительную отрасль Беларуси составил 1 млрд. долларов США.
Строительная отрасль США рассматривается как ключевой показатель мощи американской экономики, доверия потребителей и динамики безработицы. Инвестиции в строительсво жилой и коммерческой недвижимости в строительной отрасли США имеют тенденцию к увеличению, сигнализируя о повышении доверия потребителей и увеличении расходов потребителей. В результате ослабления рынка недвижимости, которому поспособствовала рецессия, многие нынешние и потенциальные работники строительной отрасли покинули отрасль с целью поиска другой работы. Резкое снижение цен на нефть также является негативным фактором отразившимся на строительной отрасли, как и сокращение проектов в энергетической сфере.
Объемы строительства в Великобритании упали во втором квартале 2016 года на 0,7%. Строительная отрасль Великобритании впала в рецессию впервые за четыре года. Эксперты говорят, что падение делового и потребительского доверия после референдума повлияют на активность строительной отрасли в ближайшие месяцы. Экономисты связывают проблемы в отрасли с сокращением государственных расходов и с ударом по инвестиционным планам частного сектора после референдума.
В 2016 году строительная отрасль столкнулась с некоторыми трудностями, вызванными мировым экономическим кризисом. Но не смотря на это строительная отрасль является основой экономического и промышленного прогресса в мире.
INTRODUCTION
Construction is the process of constructing a building or infrastructure. Construction differs from manufacturing in that manufacturing typically involves mass production of similar items without a designated purchaser, while construction typically takes place on location for a known client.
Construction as an industry comprises six to nine percent of the gross domestic product of developed countries.
Construction starts with planning, design, and financing; and continues until the project is built and ready for use.
Large-scale construction requires collaboration across multiple disciplines. An architect normally manages the job, and a construction manager, design engineer, construction engineer or project manager supervises it. For the successful execution of a project, effective planning is essential.
Those involved with the design and execution of the infrastructure in question must consider zoning requirements, the environmental impact of the job, the successful scheduling, budgeting, construction-site safety, availability and transportation of building materials, logistics, inconvenience to the public caused by construction delays and bidding, etc. The largest construction projects are referred to as megaprojects.
In general, there are three sectors of construction: buildings, infrastructure and industrial. Building construction is usually further divided into residential and non-residential (commercial/institutional). Infrastructure is often called heavy/highway, heavy civil or heavy engineering. It includes large public works, dams, bridges, highways, water/wastewater and utility distribution. Industrial includes refineries, process chemical, power generation, mills and manufacturing plants. There are other ways to break the industry into sectors or markets.
The building materials industry plays an important role in Belarusian economy. The United States construction industry is viewed as a key indicator of the strength of the American economy, consumer confidence and unemployment trends.
The United Kingdom construction output fell 0.7% in the second quarter of 2016 after a drop of 0.3% in the previous three months. Economists put the industry’s troubles down to government spending cuts and a blow to private sector investment plans from the referendum.
1 BUILDING MATERIALS INDUSTRY IN BELARUS
1.1 Characteristics of the building materials industry
The building materials industry in Belarus is represented by about 1,500 enterprises of different form of ownership, that specialize in the production of cement, wall, coating and finish materials, precast concrete and concrete structures, roofing materials, etc. In total, the country produces over 130 kinds of building materials and products.
The enterprises of Belarus export about 50 types of building materials, products and constructions. Moreover, 80% of export volume accounts for ceramic tiles, polished glass, roll roofing materials, building constructions, ceramic and silicate bricks, cement, break-stone. According to the Ministry of Architecture and Construction, in 2012 the construction industry of the republic increased the export by 1.4 times compared to 2011 up to 520 million US dollars.
In the past few years, the construction complex of Belarus has been going through a period of modernization of the production of building materials, on which it is planned to spend BYR 12.5 trillion by 2015. Build-up of the capacity of domestic enterprises, as well as harmonization of building regulations with European regulations is taking place. Major segments of the industry and the largest enterprises.
1.2 Building materials and products
Future demand of the republic in cement taking into account the production export in 2015 is projected to amount to 4 million tons per year. Cement export from Belarus is carried out mainly to Poland, Lithuania and Latvia. It is planned to increase the volume of export to 25% of total production.
The Belarusian flagships in cement production are RUE “Belarusian Cement Plant” located in the city of Kasciukovičy with a capacity of 1.2 million tons per year, as well as “Krichevcementnoshifer” (Kryčaū) and OJSC “Krasnoselskstroymaterialy” which has the largest and most modernized production of cement in Belarus.
In 2012, due to the high demand for cement, the capacity of the two following cement plants was increased by 3.6 million tons of cement per year – “Krasnoselskstroymaterialy” and “Belarusian Cement Plant”.
Among Belarusian finish materials, ceramic tile occupies perhaps the leading role in terms of export volume.
The flagship in the production of this material is OJSC “Keramin” (Minsk), where, in particular, the production of ceramic granite is also developing. The enterprise works in collaboration with Italian companies. Moreover, tile is produced by enterprises “Brest KSM” (Brest) and “Berezastroymaterialy” (Biaroza).
One of the main wall materials — construction brick – is produced at a whole range of Belarusian enterprises. These are the Minsk plant of building materials and the Minsk plant of silicate products, OJSC “Keramika” in Viciebsk, the Radaškovičy ceramic plant which also mastered the production of porous ceramic blocks, and many others. Over the last few years, Belarus has created working capacity for the production of cellular lime concrete which became one of the most used building materials in the country. OJSC “Smorgonsilikatobeton” in Smarhon’ and OJSC “Zabudova” in the village of Čysc’ of the Minsk region are engaged in the production of cellular building blocks.
There are about 100 manufacturers of paint products in Belarus, but the basis of this segment are 7-8 companies. The leaders of the sphere are OJSC “Lakokraska” (Lida), OJSC “Minsk Paint Plant”, LLC “Esgit”, PUE “MAV”. Belarusian paint materials are exported to Russia, Ukraine, Moldova, Uzbekistan, Kazakhstan, Austria, Bulgaria, Hungary, India.
In 2013, the project on the production of anti-corrosion coatings will be further developed at the Lida OJSC “Lakokraska” together with the Norwegian company Jotun Paints. The plant installed units which will allow producing enamel for painting pre-primed metal surfaces. The capacity of the line will amount to 250- 300 liters of enamel per hour.
In the last 3 years, the market of dry building mixes of Belarus has been growing by 17% on average per year in real terms. About 35 companies work in the segment of dry building mixes in the country, but 2/3 of the market account for five leaders: Taifun, Henkel Bautechnic, ILmax, Krasnoselskstroymaterialy and Sarmat. The main production trends of Belarusian DBM: cement (55%), polymer (30%) and gypsum (15%). Today the DBM segment is working on increasing the competitiveness of local brands, introducing energy-efficient building technologies for the rational use of fuel and energy resources.
Over the past few years, Belarus has considerably increased the number of enterprises which offer various roofing materials. There is active interest in the production and sale of these goods both on behalf of Belarusian companies, as well as foreign investors. Among the largest joint ventures in the roofing segment is OJSC “Krovlya”. This is a Belarusian-British project, producing rolled roofing and waterproof materials.
The company is part of the corporation TekhnoNIKOL – European manufacturer of building materials.Another major enterprise in the segment of roofing is OJSC “Gidrostekloizol” in the Brest region. The company produces synthetic materials and glass basics with bitumen-polymer coating, as well as bitumen-polymer roofing materials on the basis of fiberglass.
1.3 Investments
In 2005-2010, the volume of investments in the construction industry of the republic amounted to 1 billion US dollars. The bulk of the funds has been used on the expansion projects of the production of ceramic tiles, cement, granite macadam. Taking into account the construction of housing, the Belarusian market of building materials remains one of the most active.
The Decree of the President “On stimulating the creation and development in the Republic of Belarus of enterprises based on new and high technologies” supports the investment climate in the construction sphere. It provides an exemption for five years from taxes and customs duties on goods and services produced with the use of new high technologies. In the future, income tax rates and value added tax on these products will be reduced. These products are exempt from export or customs duties during the payback period.
Examples of investment projects in the Belarusian construction sphere:
1. increase of the capacity of two cement plants by 3.6 million tons of cement per year — ”Krasnoselskstroymaterialy” (Vaūkavysk district, Hrodna region) and “Belarusian Cement Plant” (Kasciukovičy, Mahileū region),
2. new capacity for the production of granite macadam – “Granit” (Mikaševičy, Brest region),
3. doubling of the capacity to produce float glass at the enterprise “Gomelsteklo” up to 34 million square meters per year,
4. new lines at enterprises producing dry building mixes: “Henkel Bautechnic” and “Taifun” (Polish Atlas Group).
At the moment negotiations for the participation of the company CRH (Ireland) in the project of production in Belarus of lime using the dry method, as well as the organization of the enterprise for the manufacture of products made of cement and lime with the use of various additives on the basis of “Krasnoselskstroymaterialy” are underway [10].
2 THE UNITED STATES OF AMERICA CONSTRUCTION INDUSTRY
2.1 Key statistics about residential and nonresidential building
The United States construction industry is viewed as a key indicator of the strength of the American economy, consumer confidence and unemployment trends. As the unemployment rate declines, investment in both residential and commercial U.S. construction tends to increase, signaling improved consumer confidence and the spending that accompanies that confidence. This spending pumps money into the economy and creates demand for consumer goods and services, which eventually leads to investment in capacity increases in the commercial sector, such as manufacturing facilities, office space and retail establishments. We are now seven years removed from the start of The Great Recession in 2008, and although we have yet to see sustained momentum in gross domestic product (GDP) growth, which has ranged between +0.6 and +4.3 percent for four straight quarters through June 2015, the unemployment rate reached a seven-year low of 5.1 percent in August 2015 (remained unchanged for September 2015). This gradual economic recovery has provided the residential construction industry with +9 percent growth in 2015 and an expected growth of +8 to 9 percent in 2016. Nonresidential construction grew +7.1 percent through H1 2015, but is expected to only grow +5 percent for the full year, as contraction in power-related, water supply and public safety projects continue.
The U.S. Census Bureau reports that there are 10 U.S. cities with 1 million or more residents. California and Texas alone contribute three cities each: Los Angeles, San Diego and San Jose for California and Houston, San Antonio and Dallas for Texas. These population estimates are based on the year-ended July 1, 2014, with results generally published about one year later. With the exception of New York City, Texas led the category with its increase in housing units. Texas cities gained the most new units (+141,625), followed by California (+77,510), Florida (+67,208) and North Carolina (+39,855). However, given the nearly one-year information lag, additional factors are needed to accurately evaluate current and near-term trends. Construction job growth is published monthly by each U.S. state. Florida's figures provide a good example of the nationwide trend of strong, recent employment gains that have begun to slow dramatically this year. Looking back at June 2014, Florida added 2,260 jobs to support the 67,000 new housing units it added in the 2014 fiscal year. However, June 2015 saw a considerable slowdown in those job numbers, with Florida adding a meager 100 jobs.
2.2 Worker shortages in the U.S. construction industry
A portion of the slowdown in hiring is explained by worker shortages across the country in this sector caused by construction worker flight. The housing crash that contributed to the recession forced many current and potential construction workers to leave the industry in search of other work or to leave the labor force altogether. Though the shortage is now causing a decline in hiring, it has bolstered overall employment figures in the industry. The Associated General Contractors of America (AGC) reported in July 2015 that construction employment totaled 6.38 million, the highest figure since March 2009, representing a +4.2 percent year-over-year increase. Unemployment in the construction sector had hit a peak of 27.1 percent in February 2010 but was down to 6.3 percent by the end of the first half of 2015. Political uncertainty played a part in the diminished labor force participation rate in the construction sector, as federal funding for transportation projects, such as highway and bridge repairs, earlier this year was low and unpredictable. The steep decline in crude oil prices is also a contributor, as projects in the energy sector have been cut back. Moody's Investors Service projected in Q1 2015 that oil exploration and production companies (E&Ps) would reduce capital expenditures by 41 percent in 2015, which we estimate will remove roughly $280 billion from the market.
Because construction trends are highly dependent on regional projects, they must be evaluated from a geographic perspective. Seattle added the most construction jobs between May 2014 and May 2015 at a rate of +15 percent (+11,300 jobs). New Orleans, however, recorded a -10 percent decline in construction jobs (-3,200 jobs) as new construction contracts declined by -89 percent to $107.6M in September 2014 versus September 2013, primarily due to a slowdown in nonresidential construction.
2.3 Headwinds facing the construction industry
Residential construction is expected to continue to grow between +7 percent and +8 percent through 2015 and 2016, with the potential for slightly lower growth and the possibility of higher interest rates. Interest rates have been kept near zero by the Federal Reserve System since December 2008. Millennials are one of the largest groups of potential homebuyers in 2015, and an increase in rates may further discourage these first-time homebuyers who are already faced with high down payment requirements, strict lending standards and high levels of student loan debt. Depressed demand for first-time home purchases limits the ability of their sellers to step up to their next home, which can have a domino effect. Furthermore, the pace of median rent growth of +4 percent has eclipsed median home value growth of +3 percent in 2015, which may further hinder buyers' ability to save for a down payment. Although the pace of home price growth has slowed from over +10 percent in 2013, data available as of Oct. 1, 2015, still reports a +4.7 percent trailing twelve months increase according to the S&P/Case-Shiller Home Price Index. This increase is mainly due to low mortgage rates and the expectation that rates will rise, given signals from the Fed for a potential interest rate hike in the coming year. As of Oct. 1, 2015, 30-year mortgage rates remain below 4 percent at an average of 3.85 percent. Higher rates will begin to slow the pace of home price growth in the next 12 months to +4 percent to +5 percent. Based on Trulia's analysis of median wages for an individual with a college degree saving 10 percent of wages annually towards a down payment, it would take more than 10 years to save for a home purchase in expensive cities such as Denver, Colorado, Portland, Oregon, or Oakland, California. Some relief may be found through new bank programs for first-time homebuyers that are beginning to surface. For example, TD Bank in Florida allows for down payments as low as 3 percent with no mortgage insurance to qualified buyers. Awareness of these programs remains low and banks report little traction thus far.
A combination of headwinds has tempered the growth outlook in nonresidential construction. Growth in the near-term will be curbed by energy-related spending cuts precipitated by the roughly 50-percent decline in oil prices since June 2014 and new restrictive legislations affecting the coal industry. The growing construction worker shortage and minimal public sector growth of just +1 to +2 percent will also impact growth expectations. As a result, the full 2015 growth forecast for nonresidential construction is expected to soften from +8 percent to +5 percent. Depending on the oil price recovery, mid to upper single-digit growth for 2016 is likely.
The Northeast held the lowest volume of new building permits by region in 2014 but surged +122 percent between July 2014 and June 2015 to 4.42 million. Meanwhile, the Midwest took the bottom spot, as it grew modestly at +7 percent. The Southern and Western regions nearly grew in tandem at +13 percent and +11 percent, respectively. The Northeast region's growth in new building permits signals a significant opportunity for the building materials sector, potentially tempered by the looming shortage of construction labor. Total construction spending has increased +13.7 percent for the similar time period, slightly lower than the +15.5 percent growth in new building permits, which may be partially explained by the skilled labor shortage [11].
3 THE UNITED KINGDOM CONSTRUCTION INDUSTRY
3.1 The UK construction industry has slipped into recession
The UK’s construction industry has slipped back into recession for the first time in four years, according to official figures that show the sector was struggling even before the vote to leave the EU.
Experts say the drop in business and consumer confidence since the referendum will further dent construction activity in the months ahead. The Office for National Statistics said output dipped 0.7% in the second quarter of 2016, following a drop of 0.3% in the previous three months. It is the first time there have been two consecutive quarters of falling output – a technical recession – since 2012, when the eurozone debt crisis shook confidence across Europe.
The ONS said its latest figures included a short period after the 23 June referendum, but noted that there was “very little anecdotal evidence at present to suggest that the referendum has had an impact on output.”
For June alone, construction output was down 0.9%, broadly in line with forecasts for a 1.0% drop.
3.2 Referendum impact on the UK construction industry
Economists put the industry’s troubles down to government spending cuts and a blow to private sector investment plans from the referendum.
A recent business survey by the data group Markit suggested pressure had intensified after the referendum. The PMI report signalled the sharpest contraction since mid-2009.
Commenting on the latest news from the sector, Samuel Tombs, the chief UK economist at Pantheon Macroeconomics said: “June’s official data confirm that the construction sector re-entered recession in the first half of this year, as public sector cuts and Brexit risk took their toll.”
“The downturn looks set to deepen in the third quarter. July’s construction PMI broadly is consistent with output falling by about 3.5% quarter-on-quarter.
Meanwhile, Brexit negotiations will be protracted, so businesses will hold off committing to major capital expenditure for a long time to come.”
When the ONS published figures last month showing a relatively strong GDP growth of 0.6% in the second quarter, it had estimated a more modest fall in construction output of 0.4%. The higher figure of 0.7% will, however, have no discernible impact on the GDP figures given that construction only accounts for about 6% of the UK economy.
The fact that the figures show the sector was already in recession before the referendum result will still fan fears for construction jobs.
3.3 Recovery of the UK construction industry
The National Housing Federation said signs of a post-referendum slowdown should prompt the government to do more to support housebuilding.
The group, which represents non-profit housing associations, said a slowdown in housebuilding similar to that of the 2008 recession would result in the loss of nearly 120,000 construction jobs over the next decade.
The federation’s chief executive, David Orr, said: “We know that an uncertain economic environment will cause builders to put the brakes on. Our country’s prosperity and thousands of citizens’ livelihoods depend on a strong building sector. We cannot let a slowdown take hold [12].
“Housing associations have a track record of building through tough times, having upped their output through the last recession when private developers could not. With the right flexibility from government, and at no extra cost to the taxpayer, housing associations can keep the nation building.”
CONCLUSION
Construction is spread all over the world. There are millions of workers involved in building process in the world. The construction industry is one of the most needed industries today, that supports other industries such as building materials, machine building, woodworking etc.
The building materials industry in Belarus is represented by about 1,500 enterprises, that specialize in the production of cement, wall, coating and finish materials, precast concrete, roofing materials, etc. In total, the country produces over 130 kinds of building materials and products. In 2005-2010, the volume of investments in the construction industry of the republic amounted to 1 billion US dollars. The Belarusian market of building materials remains one of the most active.
Investment in both residential and commercial U.S. construction tends to increase, signaling improved consumer confidence and the spending that accompanies that confidence. This spending pumps money into the economy and creates demand for consumer goods and services, which eventually leads to investment in capacity increases in the commercial sector, such as manufacturing facilities, office space and retail establishments. The housing crash that contributed to the recession forced many current and potential construction workers to leave the industry in search of other work or to leave the labor force altogether. The steep decline in crude oil prices is also a contributor, as projects in the energy sector have been cut back. Millennials are one of the largest groups of potential homebuyers in 2015, and an increase in rates may further discourage these first-time homebuyers who are already faced with high down payment requirements, strict lending standards and high levels of student loan debt.
The UK’s construction industry has slipped back into recession for the first time in four years, according to official figures that show the sector was struggling even before the vote to leave the EU. Experts say the drop in business and consumer confidence since the referendum will further dent construction activity in the months ahead. Economists put the industry’s troubles down to government spending cuts and a blow to private sector investment plans from the referendum.
In 2016 the construction industry faced some difficulties, caused by world economic recession. But it is impossible to imagine our live without housebuilding, which is a big part of the modern society development. The construction industry is the basis of economic and industrial progress in the world.
REFERENCES
1. Belarus facts [Электронный ресурс]. – Электрон., текстовые дан. – Минск, 2017. – Режим доступа: https://belarusfacts.by/en. – Дата доступа: 20.02.2017.
2. Сonstruction business owner [Электронный ресурс]. – US, 2017. – Режим доступа: https://www.constructionbusinessowner.com. – Дата доступа: 22.02.2017.
3. The Guardian: economics [Электронный ресурс]. – Электрон., текстовые дан. – UK, 2017. – Режим доступа: https://www.theguardian.com. – Дата доступа: 24.02.2017.