South Africa's construction industry is pulling off a strange trick. New figures from Statistics South Africa show it earned R605.6 billion in 2024, growing almost 9% a year since the last survey, and posted its best profit margin in a decade at 4.8%. Yet by the measure that matters most, it keeps getting smaller.
More money, less economy
Construction now accounts for just 2.4% of the economy, down from 2.5% a year earlier and 3.9% a decade ago. Income has grown steadily, but the sector's weight in the economy has been sliding for years. The job market tells a similar story. Employment has climbed from a Covid-era low of 479,071 in 2020 to about 539,000, but that's still short of the 592,125 people the sector employed back in 2017, and a recent labour survey showed 110,000 construction jobs lost in a single quarter. Small and micro firms now do most of the heavy lifting, providing 78.6% of the sector's jobs. "If one promotes small businesses in the construction industry, they will tend to have a significant impact on employment," says Stats SA's Joe de Beer. The gains weren't evenly spread: the top 100 firms took 26.7% of total income, and site preparation was the standout with a 13.2% profit margin.
The long slide
Total income has climbed from R430.8 billion in 2020, but de Beer traces the sector's fading weight to the end of the building boom around the 2010 World Cup. The industry is a shadow of the glory days when highways, airports and stadiums went up for the World Cup, and is "nowhere as large" as it was in 2014 and 2017. Three provinces, Gauteng, the Western Cape and KwaZulu-Natal, still account for nearly three-quarters of the sector's income.
There's a reason this matters beyond the numbers. The report landed two days after Treasury's director-general, Duncan Pieterse, argued that construction and tourism offer more room for job creation than an increasingly automated manufacturing sector. Getting there may mean tackling what scares investors off, including the so-called "construction mafia" that muscles onto sites demanding 30% of project values, now the target of a fresh cabinet crackdown.
