Economic security of the construction industry
The main issues of assessing economic security are considered, taking into account the specifics of the construction industry. The main types of economic security, criteria for assessing the level of economic security, factors that affect the economic security of the construction industry and the activities of construction enterprises are singled out. It is substantiated that the main threats in the field of construction can be divided into external (arising outside the construction site) and internal (threats arising during work at the facility itself).
Threats to economic security in general can be divided into internal and external. Internal threats include “the inability to self-preservation and self-development, the weakness of the innovative principle in development, the inefficiency of the system of state regulation of the economy, the inability to find a reasonable balance of interests in overcoming contradictions and social conflicts in order to find the most painless ways for the development of society” [1]. External threats include “changes in the state of world prices and foreign trade, as well as sharp fluctuations in the exchange rate, the excess of capital outflow over its inflow (foreign investment); large external public debt and an increase in corporate debt, excessive import dependence, export overload with commodities” [1]. The development of construction is one of the most important promising areas of socio-economic development of Ukraine after the victory. The emergence of external threats is due to the high dependence of the work of construction organizations on relations with state and local authorities. These threats include the following:
- using administrative opportunities to influence competitors or gain benefits;
- changes in regulatory regulation;
- pressure on the construction company by officials. The specifics of construction activities often do not allow a clear assessment of the upcoming costs of building an object, which entails the following threats:
- increased competition with limited demand;
- increased competition in a certain territory;
- unfair competition;
- monopolization of the market.
A feature of the construction industry is also the dependence of work on the season and their arrhythmia, which inevitably leads to an increase in non-production costs and the emergence of the following threats:
- factor of weather conditions (natural disasters);
- the risk of causing economic damage due to planning errors.
In addition, external threats also include threats related to the general situation in the country:
- economic and political situation in the country;
- reduction of solvent demand;
- reduction of investment in construction;
- growth in the cost of financial resources.
Complex and decisive are the internal threats associated with the activities of the construction industry, among which the most significant are the following.
Threats associated with the technical process at the construction site:
- causing damage to a construction site or equipment, damage to inventory items;
- causing damage to the life and health of personnel;
- the threat of defects in the work performed by subcontractors, as well as the occurrence of defects due to the low quality of the building materials used, components;
- the threat of marriage in the work performed by the construction company itself;
- the threat of marriage due to the poor quality of work of design organizations, general contractors;
- the threat of the appearance of marriage, due to the violations in the technological process;
- cost overruns;
- violation of the project implementation deadlines.
Threats related to personnel:
- insufficient qualification of management personnel;
- decrease in the quality of work performed;
- an increase in injuries at the facility;
- an increase in the threat of theft of inventory items;
- sanctions applied by the authorized bodies against the construction company in connection with the violations of labor laws [2].
Note that this division is conditional, since changes in the external environment of the construction object, of course, entail changes in its internal environment.
References
1.Data on System Approach to Process of urban housing construction, renewal and upgrading / A. Lekan, O. Faith, A.C. Ninma, A.O. Sunday. // Data on Brief. – 2018. – No. 19 – Pp. – 2427-2437 2. Real estate prices and systemic banking crises / Y. Deng, Y. Zeng, Z. Li. // Economic Modelling. – 2019. – Vol. 80. – Pp. 111-120.