The Construction Industry in Nigeria
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Dec 16th, 2019

The Construction Industry in Nigeria

In Nigeria, like most developing countries, the construction industry plays a role in meeting the needs of infrastructural and economic activities of the country. According to Olowo-Okere (1988) the construction industry accounts for about 60 percent of the Nation’s capital investment and 30 percent of the Gross Domestic Product (G.D.


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UKCG defined the construction industry as a driver of growth in other sectors due to its heavy reliance on an extended and vary supply chain. Furthermore, he said all other sectors of the economy such as transportation, agriculture, manufacturing, education, health ,sports and so on they all depends on construction industry and vice versa that is the construction industry also relies on these sectors of the economy.

According to Nwosu, (2003), approximately two-thirds of the value of fixed capital produced in Nigeria each year emanates from the construction industry. He further acknowledged that construction industry also generate employment opportunities which place it second to government in the employment of labour.

Furthermore, the construction industry is said to have contributed about half of the total stock of fixed capital investment in the Nigeria economy (Olaloku, 1987).

When the construction industry was booming in the 1970’s, the country’s economy experienced similar effects during that period.
However, from early to mid 1980’s, the industry experienced a jolt and its effect was felt in all spheres of national life (Isiadinso, 1988).
Buhari (1991) reported that the lull in construction of early 80’s was not limited to Nigeria alone.

The lull also occurred in Western Europe and America. But the parent companies of these big timers in our midst were not only able to stay afloat the stormy ocean but were able to expand their sales. They were able to do this by initiative, creativity and research. Oladerin Ogunsemi and Aje (2012) explained the roles construction industry played in the economy and the vital activities of the industry which led to the achievement of socio economic development goals of providing shelter, infrastructure and employment.

Consequently, the Federal and State governments resorted to taking foreign loans as a quick solution to the problem. However, some of the measures taken by Government in order to revitalize the economy have further aggravated the situation. One obvious implication of this development is that the initial cost of imported raw materials and subsequently of the finished products has substantially increased (Husseini, 1991). Mbachu and McAdoo (2004)reported that these substantial increase have obvious negative implications for the major players and the industry; undermining the viability and sustainability of the industry.

From the real estate academic, in terms of critical evaluation community development appraisal has remained unimportant. Usually construction is coordinated by general contractors; they specialize in a particular type of construction which is residential or commercial building. They take full responsibility of taking the job. However general contractors may carryout some portion of the work with their co workers and subcontract the some of the work to heavy construction or trade contractor’s specialty.

Specialty trade contractors are those that do their work in a particular trade like painting, electrical work and carpentry works including plumbing and heating. Specialty trade contractors has no responsibility for the structure as a whole. They obtain orders for their work from general contractors, architects, or property owners.

Furthermore, construction industry is the sector of national economy that engages in the preparation land and construction and revamping of roads, buildings, structures and facilities. In the Australian economy, the construction is the number fourth in the contributing to gross domestic product and it plays a vital role in determining the economic growth.

The construction industry accounted for 6.8% of the gross domestic product in chain volume terms in 2008- 2009, compared with the gross domestic product 7.0% in 2007-2008. Previously, the construction industry following one after the other experienced seven years of growth as a proportion of gross domestic product(GDP) ever since tax was introduced to goods and services( GST) in the year 2000-2001.

Both in the private and public sectors, the construction industry operated in engaging in the three broad areas that is residential, non residential, and engineering construction.

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