Urbanisation has driven strong growth in the global construction market, and the trend is set to continue as the industry embraces automation, AI and green construction software, according to a new study.
The Construction Global Market Report 2024 from Research & Markets found that the global construction market has grown from $15.19 trillion in 2023 to $15.97 trillion in 2024 at a compound annual growth rate (CAGR) of 5.1%.
This was largely driven by a surge in infrastructure development, escalating renovation efforts, rapidly ageing populations and an upsurge in domestic manufacturing.
The market is expected to reach $19.85 trillion in 2028 at a CAGR of 5.6%. This will be driven by continuing urbanisation, population growth, government backing, industrialisation and the emergence of smart cities.
Urbanisation in particular will drive demand for essential buildings and infrastructure. The report notes World Economic Forum data from April 2022 indicated that 4.3bn people, or 55% of the global population, currently live in urban settings. This is expected to rise to 80% by 2050.
The surge in global construction activity will fuel demand for services and materials. Emerging markets such as China, Brazil, India, Saudi Arabia and Indonesia already show “robust” construction undertakings.
Automation, digital transformation and AI
Amid rising demand, construction firms are expected to increasingly embrace automated construction tools, digital platform integration, AI and machine learning, strategic partnerships, innovation networks and fully electric construction equipment.
Major players are already actively pursuing innovative technologies, particularly automation, to elevate project efficiency, cut costs and gain a competitive advantage, the report said.
It pointed to automated construction service centres, which serve as centralised facilities that leverage technology to streamline scheduling, resource allocation and communication. In July 2023, Tata Steel unveiled its first-ever fully automated construction service centre in Odisha, India.
Green construction software gaining traction
The report said construction firms are increasingly embracing sustainable building materials and processes to create more environmentally friendly, energy efficient buildings. The World Green Building Trends Survey indicates that around 60% of global construction firms are engaged in green construction projects.
Certification initiatives such as Leadership in Energy & Environmental Design are empowering construction to create high-performance, sustainable residential and commercial buildings.
Meanwhile, green construction software, such as Construction Suite for ensuring green compliance and the Green Globes management tool, is continuing to gain traction.
