Recent trends in the construction industryOver the last decade, the Japanese construction sector has recovered from a period of negative growth that had continued since the burst of the economic bubble in the 1990s. Reconstruction work following the Great East Japan Earthquake in 2011 partly contributed to the recovery. In more recent years, the Tokyo 2020 Olympic Games were a key driver of demand. Major construction projects planned in preparation for the World Expo 2025 in Osaka and the construction of the Chuo Shinkansen maglev line are expected to have a similar impact.
Infrastructure maintenance and urban redevelopment also play an important role for the construction sector as a substantial part of Japan’s deteriorating infrastructure was built in the 1960s and 1970s and the government intends to tackle its redevelopment. In Japan, which is prone to natural disasters, the construction sector is also of great importance for reconstruction and disaster prevention. As natural catastrophes such as floods have caused increasing damage in recent years, affecting annual budgets for reconstruction and disaster prevention, they will likely continue to create demand for construction work.