Even without this, economic activity could slacken in connection with decreased investment on account of falling demand and lower profits, as well as with a lower consumption propensity among households whose debt burden is already very high. In the euro area the available statistics indicate that the slackening of activity in the late autumn and winter was more marked than expected, mainly on account of weaker exports. Manufacturers and households differ in their assessments of the future; the former count on a turn for the worst, whereas consumer confidence has continued to improve. The direction in which confidence moves for these two groups will be crucial for prospects in the euro area. The optimistic trend among households has so far helped to mitigate the consequences of decreased external demand. The question is whether this will continue to be the case if industrial activity does not take a turn for the better. The Japanese economy has not shown any clear signs of recovering, though in some respects it does seem to have stabilised. The future path here is still highly uncertain. All in all, the statistics point to an international trend in the next two years that is weaker that in the Riksbank’s main scenario last autumn, though the differences should not be exaggerated. Together with lower commodity prices, the weaker international activity should result in lower external price pressure. The outlook in 2000 and beyond is, however, very difficult to foresee. One uncertainty is the endurance of U.S. economic growth.
This Construction Sector Group has found that approximately one-third of unemployed construction workers lack occupational experience and around 6 per cent also lack formal training. In that the average age of construction workers is rising and young people do not find construction work attractive, the bottleneck  5  BIS Review 18/1999  problems may become even greater in the future. In order to prevent this from leading to sizeable problems, proposals have been put forward for increased mobility, improved competence and marketing of construction courses, for example. Construction costs are measured by the factor price index (FPI); the largest item is wage costs. The price of completed dwellings, on the other hand, is measured by the building price index (BPI), which also includes the construction companies’ productivity and profit margins. These indexes do show relatively large price increases but there are no actual signs of any direct risks of an inflationary development in Sweden in the coming years, provided that the bottleneck problems do not increase. The rising costs associated with earlier upswings in activity have been connected with the contemporary subsidy systems as well as the high degree of concentration in the construction market. The revised system for financing residential construction has appreciably reduced one of these problems: construction companies as well as consumers are exposed more directly to production costs. But the problem of concentration in the construction market still remains and may be a future cause for concern.