How Construction Sector Responds to the Economic Recession: Identification of Adverse Effects and Sustainable Responsiveness

Abstract

The construction industry is a significant source of income generation to the economy contributing more than 9% of the GDP in Sri Lanka. Thus, the construction industry is concurred a direct positive correlation with the cyclical nature of the economy resulted in a stagnation during the economic recession. In general, practitioners adopt various strategies in response to a recession to realize firm s' continued existence and development. However, the current responsiveness to mitigate adverse effects identified became reactive which only considers the short-termism. Hence, the recession responsiveness must be aligned with the sustainability for a long term proactive implication. Therefore, this research study aims to assess the adverse effects and the sustainable responsiveness during the recession. The research gap was then approached through a questionnaire survey among construction practitioners to gather ordinal data on criticalness of adverse effects and appropriateness of recession responsiveness. Then, the research was concluded by extracting appropriateness of adopting sustainable responsiveness to mitigate adverse effects. The analysis derived cost control strategies have given more sustainable responsiveness supersedes the other strategies. Thus, it is recommended to be aware of the recession rather beware.