Germany’s construction sector is facing renewed pressure as escalating material and energy costs deepen an already challenging downturn, industry leaders have warned.

According to construction industry representatives, recent instability in the Middle East and disruptions affecting key global trade routes have contributed to fresh price increases for essential building materials and fuel supplies.

Industry officials say the costs of products such as bitumen, cement, concrete, plastics, diesel and heating oil have risen sharply, placing additional strain on construction firms already grappling with weak demand and economic uncertainty. A recent survey found that nearly 80 percent of companies reported significant increases in the prices of bitumen and plastics.

Despite the difficult operating environment, construction businesses generated combined revenues of approximately €432 billion in 2025, a marginal increase of 0.8 percent compared to the previous year. However, industry leaders noted that the growth was largely driven by inflation and higher prices rather than an increase in actual construction activity.

Looking ahead, the sector expects revenues to remain relatively stable in 2026, although experts caution that any stability is likely to reflect continued cost inflation rather than a meaningful recovery in building output.

Industry stakeholders are calling on the German government to accelerate planning and approval procedures, provide more reliable housing support programmes and increase investment in infrastructure projects that directly benefit local communities.

They argue that a stronger construction sector could play a vital role in revitalising the German economy, stressing that targeted policy support is needed to unlock growth and reverse the prolonged slowdown.