The analyst expects the construction industry in Italy to contract in real terms by 3.8% in 2025 and 5.7% in 2026, owing to falling building permits, rising public debt, and weakness in the residential sector. According to the Bank of Italy, public debt of the country reached an all-time high of EUR3.034 trillion ($3.3 trillion) in March 2025, a 0.3% increase compared to February 2025. In May 2025, the European Commission reported that Italy’s public debt is expected to reach 136.7% of GDP in 2025 and 138.2% in 2026. In a setback to the construction industry’s output, the annual gross fixed capital formation in dwellings declined by 6% year-on-year (YoY) in Q1 2025, according to the Italian National Institute of Statistics (Istat), this was preceded by a YoY decline of 7.1% in Q4 and 5.5% in Q3 2024. Additionally, the Italian government is planning to cut EUR4.6 billion ($5 billion) of the EUR5.8 billion ($6.3 billion) earmarked to fund the automotive sector during 2025-2030 period, due to a global slowdown in sales of electric vehicles (EVs). In another setback to the industry, the U.S. tariffs, including a 10% general tariff and a 25% tariff on steel, iron, and automotive goods, are likely to raise short-term costs in Italy's construction industry. These tariffs increase the price of imported machinery, materials, and components, leading to more expensive projects.
The Italian construction industry is however expected to recover in 2027 and record an average annual growth of 1.4% between 2027 and 2029, supported by investments in renewable energy and transport infrastructure. Growth will be driven by the government's aim to increase the share of renewable energy in the total power mix from 18.5% in 2022 to 59% in 2030. In line with this, in March 2025, the national transmission grid operator Terna revealed its plans to invest EUR23.5 billion ($25.6 billion), from 2025 to 2034, to boost the energy capacity in the country
The Italian construction industry is however expected to recover in 2027 and record an average annual growth of 1.4% between 2027 and 2029, supported by investments in renewable energy and transport infrastructure. Growth will be driven by the government's aim to increase the share of renewable energy in the total power mix from 18.5% in 2022 to 59% in 2030. In line with this, in March 2025, the national transmission grid operator Terna revealed its plans to invest EUR23.5 billion ($25.6 billion), from 2025 to 2034, to boost the energy capacity in the country
The Construction in Italy - Key Trends and Opportunities to 2029 (Q2 2025) report provides detailed market analysis, information, and insights into the Italian construction industry, including:
- The Italian construction industry's growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Italian construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Scope
This report provides a comprehensive analysis of the construction industry in Italy. It provides:
- Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in Italy, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to Buy
- Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
- Assess market growth potential at a micro-level with over 600 time-series data forecasts
- Understand the latest industry and market trends
- Formulate and validate business strategies using the analyst's critical and actionable insight
- Assess business risks, including cost, regulatory and competitive pressures
- Evaluate competitive risk and success factors
Table of Contents
1 Executive Summary2 Construction Industry: At-a-Glance6 Construction Market Data
3 Context
4 Construction Outlook
5 Key Industry Participants
7 Appendix
List of Tables
List of Figures
