Korea's construction survey index rises but remains below benchmark, signaling sluggishness

Last month, the Construction Business Survey Index (CBSI) rose by 6.7 points compared to the previous month. However, it still remains below the benchmark of 100, indicating that the outlook for a sustained economic slump is still prevailing.

The Korea Construction Industry Research Institute (KOSIC) noted on the 12th that last month's CBSI recorded a rise of 6.7 points to 74.8 compared to the previous month.

The CBSI is an economic index calculated based on survey results targeting construction corporations. A value below the benchmark of 100 indicates that more corporations view the current construction market situation pessimistically than optimistically. A value above 100 means the opposite.

The Construction Performance Index (85.0) rose by 12 points from the previous month, marking the largest increase. The new order index (71.1, +10.4 points), order backlog index (80.4, +10.4 points), material supply index (93.5, +9.4 points), construction receivables index (85.1, +9.0 points), and financing index (76.5, +6.3 points) followed in order of increase.

By project type, the new order index for civil engineering (65.7, +11.7 points), non-residential construction (69.1, +9.6 points), and dwellings (70.8, +4.8 points) all saw increases.

By corporation size, the large corporation index (100.0, +16.7 points) and the small and medium-sized corporation index (61.5, +5.1 points) rose, while the mid-sized corporation index (63.3, -1.2 points) declined.

By region, both the Seoul index (93.4, +11.1 points) and the local index (63.2, +7.3 points) increased.

The influence of the April new orders index on the comprehensive performance index was 60.0%, and the impact of the order backlog increased by 3.7 percentage points compared to the previous month, totaling 16.9%.

However, this month's outlook index was recorded at 71.9, which is 2.9 points lower than the April performance index. The comprehensive outlook index remains below 100, indicating a high proportion of negative outlooks for the construction market.

Researcher Lee Ji-hye from KOSIC said, "Although the index rose compared to last month, the situation continues to be below the benchmark of 100, making it difficult to expect a clear improvement in the economy.