The biggest industrial employer – 10.4% of GDP and 49.2% of Gross Fixed Capital Formation (FIEC, 2008) – 30% of industrial employment, 7.6% of total employment (16.3 million operatives) – 3 millions enterprises (95% SMEs with <20 workers, local markets, low innovative) A large influence on the whole economy – 48,9 millions workers depending on Construction – The buildings/infrastructure supplied by the Construction sector serve a lot of other industries and services The Construction Sector in EU27  £1 spent on construction output generates directly £2.84 in total economic activity (mainly locally) Impact on economic activity – Construction is one of the best ways of stimulating economic activity – not just in the construction sector, but across the economy as a whole, including troubled manufacturing sectors (the construction industry is a driver of growth in other sectors due to its heavy reliance on an extended and varied supply chain. It has one of the lowest levels of imports, so the stimulus spending stays within the national economy. Contribution to employment – Construction is the best sector for stimulating employment and many regions are heavily dependent on construction jobs. Benefits of investment – Construction is not only immediate economic production, it is also investment rather than consumption, which provides significant long- term economic and social benefits. 1

The Construction sector will contribute to promote a resource efficient, sustainable and competitive European growth: – By promoting energy efficiency The built environment in Europe could be designed, built or renovated with high energy efficiency, thus improving the quality of life of (future generations of) European citizens. By 2050, most buildings and districts could become energy neutral, and have a zero CO2 emission. Numerous buildings would even be energy positive, thus becoming real power plants, by developing new materials, products and processes, integrating renewable energy sources, clean distributed generation technologies and integrated smart grids at district level together with new services and business models. To reach these goals, the ECTP has launched an industrial initiative on the energy efficiency of buildings and districts (E2B-Energy Efficient Buildings European Initiative), currently being implemented under FP7 within the EeB PPP. – By modernising our transport sector A functional infrastructure network is the artery system of our society being essential to Europe’s prosperity and closely linked to economic growth and quality of life, matching the needs of the resident population with the laws of the global market and trade. Future infrastructure could provide smooth operation and increased transport fluidity, adopting innovative advanced solutions, IT systems and services to support enhanced network and environmental management, fostering sustainable use of resources in densely populated areas, including alternative energy sources and eco-efficient materials and available (subsurface) space, to reduce the impact on and of climate change. To reach these goals, The ECTP has decided to launch a new initiative Refine-Research for Future Infrastructure Networks in Europe. –By reducing the consumption of natural resources Design, construction and operation of the built environment must also be compatible with the rational use of resources (including available space in densely populated areas) and the safeguarding of the environment, implying a preventive approach with respect to environmental challenges and privileging energy efficiency and use of renewable sources. The Construction sector will reduce the need for raw materials while favouring recourse to recycled materials and to new/existing materials with enhanced performances and longer durability, saving energy since the production phase. It will also develop new or improved products and services with a significant smaller ecological footprint. The Construction sector contributes to ensure economic, social and territorial cohesion: – Access to proper housing in a healthy (urban) environment is one of the pillars of living conditions, and it depends on: sustainable refurbishment of decayed dwellings and urban regeneration, as well as resource-efficient, low cost social dwellings (industrialisation plays an important role) to guarantee housing access to everybody. (comments according to OG meeting slides…) – The building construction sector is the biggest industrial employer in Europe, with 30 % industrial employment in Europe, and about 16 million direct jobs. Therefore, innovation in construction (and corresponding efforts to implement these in practice, e.g. through training and education) strongly contributes to high level employment in this important sector. – Providing that European’s population is ageing rapidly, and the number of disabled people is increasing, new accessibility and domotics technologies for the improvement of the indoor and outdoor environment will highly contribute to independent and inclusive life of all European’s population. – In a new multicultural Europe, conservation of cultural heritage makes people valorise rich history and culture and it contributes to promote tolerance and fight again ethnic conflicts. Besides, construction sector employs 25% of immigrant workforce, thus highly contributing to their integration into European society and its economic system. – Territorial cohesion mostly depends on the interconnection within the territory, and also with other territories, so suitable and affordable (public) transport infrastructures highly contribute to this item. The Construction sector, Smart Growth and Innovation (to be drafted) Supply chain collaboration Creating the market development agenda - Roadmapping and Value Mapping Joint market development – Government working with the Private sector Industry group leadership – a role for ECTP and the National Platforms Business models Service vs. ownership Pay As You Save – finance with payback on energy-saving Promoters of innovation Communication, shared vision, parallel development throughout the supply chain Culture – senior management support Education – secondary and tertiary levels Research, development, demonstration and deployment through PPPs Tools – systems design, economic and business modelling, technical simulation and verification EU & National government interventions Strategic procurement (of capability and at scale) – c.f. DARPA & SBRI from the Technology Strategy Board Regulation as a lever for markets – interoperable standards Working to create capability across national boundaries Addressing roadblocks Reaching SMEs - absorptive capacity Skills development at scale Silo’d, ‘Balkanised’ industry – 'trade secrets’ Systems modelling and design High fidelity simulation of building performance Holistic design at district and town level – ‘what-if’ tools Integrated networks of infrastructure Off-site manufacturing CAD-CAM, rapid prototyping and agile manufacturing Just-in-time delivery, logistics development Modular construction Lego-like, services standardisation Smart control of built environment (E2B, indoor and outdoor) Intuitive, adaptive, personalised Interoperability, open systems Integrated energy management (E2B) Selection from multiple sources of renewables Building Information Management Buildings and infrastructures for life (reFINE initiative) Adaptable homes and infrastructure for an aging demography Digital connectivity for multi-functional enhancement – safety, security, energy performance Building and infrastructure performance and control Finance impacts - Validation of energy savings for new-build and post- retrofit Using sensor technology to monitor building and infrastructure performance On-site ‘hindrance-free’ upgrading building and infrastructure performance Design for materials and component re-use Eliminating waste from build The Construction Sector 2

The Construction sector and Education: Participation in education has an unambiguously positive impact on earnings. Due to a market failure, individuals do not invest in the optimum level of education and training. The State, therefore, is justified in intervening in the market for education and training at certain levels, notably at primary and secondary level, and for certain target groups (for example, individuals who left formal education without completing a leaving certificate or equivalent). In the years ahead, labour productivity will be the key determinant of economic growth in Ireland, and increasing productivity will depend to a large extent on education and training. A workforce that is better educated and trained can produce higher value goods and services, and is more likely to innovate. Improved education and training also yield a social dividend: they result in better social cohesion and public health, and mitigate against poverty, crime and social welfare dependency. Finally, globalisation requires a flexible workforce. Ireland, as a small open economy, must be able to respond rapidly to changes in the world economic and technological environment; only a well educated population is able to respond in this way. Sustained and enhanced investment in the educational and training infrastructure is thus necessary and desirable for the foreseeable future. The study by NUTEK (2000) shows that the proportion of higher educated employees is significantly associated with both productivity (value added) and profitability (revenues to cost ratio). More recent research findings also suggest that investments in training generate substantial gains for firms irrespective of whether the training is useful to other firms. The evidence that employers profit from training investment comes from different countries including Ireland, Britain, the Netherlands, Sweden, France, as well as the US. In most of these studies we can, with reasonable confidence, maintain that training generates performance effects and not the other way around. The effects of education and skills/competence on productivity and innovation are generally positive and significant. That we also start to see studies that connect education and skills with profitability might be somewhat more unexpected. That firms extract profit from prior education is also related to the ability of firms to capture returns from general training investments. Although micro companies may focus on organisational learning processes, they are largely dependent on public or semi-public educational initiatives. Available courses continue to develop in form and content, making them quite popular among micro companies. New training models have been developed, not least through EU sector initiatives, which are tailored to company needs. The percentage of the adult population aged 50 to 74 participating in education and training grew from 2.9% in 2000 to 4.3% in The percentage of the adult population aged 25 to 64 participating in education and training is 9.5% in From the perspective of education, the two key drivers of change in construction are: 1. The shift to performance contract. This movement asks for a larger quality awareness of people on site. 2. Health related to aging workforce. A larger part of the workforce has to learn to work longer under physically heavy conditions. The Construction sector and Competitiveness: Clearly whatever good intentions and political ambitions we may have, only when sufficient financial resource are available it is possible to deploy activities to achieve our goals. As such the competitiveness of our industrial activities in Europe is a condition sine qua-non to achieve our ambitions and to surmount the grand challenges addressed in the EU 2020 strategy. In this respect the construction sector can contribute a lot as an enabling sector, indeed: - The construction sector can improve the business environment, especially for SMEs by providing transport and logistics infrastructure and facilities for all industries. This is essential for increasing competitiveness and reducing risks as good communication and efficient delivery of resources and merchandise are essential for the development of prosperous companies and to prevent delocalisation of the European industry. - With respect to its own activities within the sector the construction industry offers ample opportunities for new business, i.e. by opening a new retrofitting markets, by facilitating the industrialization of the construction process (modular/flexible approach…), by promoting the take-up of key enabling technologies such as nano-, bio- and ICT- technologies. - In order to anchor a adequate level of activities in Europe it is furthermore essential that the sector invests in promoting and developing technologies and production methods that reduce the use of natural resources and promotes the transfer of knowledge through demonstration and training programmes on best practices. - By promoting incentives for performance-based regulations and promoting ambitious targets to develop a lead market in sustainable construction it is further believed that the construction industry can be a driver for further industrial development which can be exported to other regions. This will enable the construction industry to compete globally and to increase its export throughout the world of components, equipment, infrastructure works and know how on site management…. - Last but not least especially the attractive culture heritage of Europe and its conservation is a factor of paramount importance to enhance the competitiveness of the European tourism sector. The Construction sector creates new skills and jobs: Construction sector will modernize labour market, with view to increase labour participation and better match labour supply and demand. - to facilitate labour mobility in sector by development of relevant legislation, common European construction skills recognition, common “construction” language, further EU harmonization of construction-related codes, etc. - to facilitate development of relevant skills throughout a lifecycle to continue increase of knowledge and skills in construction works: - to establish framework for cooperation in education and training involving relevant stakeholders on different levels (from basic vocational to university level). To make education and training systems being able to respond in flexible way to construction labour market demand and changes (in other words: increase industry’s involvement in all levels of education, including life-long learning initiatives?) - to ensure construction competences/skills will be recognized throughout Europe - to monitor at EU level age and gender changes of the workforces, increase/decrease in workforce (and thus competences) demand per sub-sector and respond in time to forecasted changes (e.g. aging and demand workforce changes) - to strengthen the cooperation with social partners to better understand social problems related to social aspects of construction sector (examples to clarify this bullet?) and better use models of problems solving (social dialog of institutions, organizations, market) - to continue work on improvement of health and safety at work in construction sector by different means (legislation, new technological solution, new organization of work, training and education, etc.) The Construction sector and the digital Society (to be drafted) and EU2020 3

Energy Efficient Buildings 4 A major world-wide challenge Buildings = major potential for energy/carbon savings today more than 40 % of energy consumption and around 30 % of GHG emissions Road Map Retrofit the existing building stock (200 million houses and many offices) Develop future positive energy buildings/districts Integrate new technologies (including renewable energy technologies) Innovation by research Recovery Plan EeB PPP call 2010 : strong involvement of industry and SMEs (24%) from the whole value chain (ECTP/E2BA : 210 Members) Construction sector ready to collaborate towards an “ideal house” for PPPs in FP8 Infrastructure for Europe Challenges – Mobility (energy saving, safety, inter-modality…), industry and services – Existing infrastructures are getting old/obsolete Roads (see winter 2010) Water supply systems (leakage, water quality)… – Risks: flooding… 100 major damaging floods between 1998 and deaths in Europe and half a million people displaces since 1998 Protection and repair of damage costs € 40 billion each year. Planned to increase up to € 100 billion in coming years Road Map to a reliable Infrastructure – Greening infrastructure: 40% less impacts on environment (raw materials, water, pollution and emissions…) – Infrastructure for a sustainable and competitive economy Smart and resilient infrastructures Infrastructures for an inclusive society Infrastructure for a sustainable urban growth (« 4D city ») The Construction sector and FP8 (to be drafted) Energy reduction of the existing stock of 200 million houses, Ageing Society and obsolete Infrastructure are the core issues for the refurbishment of our living environment. Construction Industry has to be pushed towards responsibility for performance by the introduction of new tools as Virtual Construction and new cooperation as Lean Construction Management. Innovation by research and integration of inputs from other sectors is essential through setting up appropriate tools (such as PPPs) in FP8