Why don't construction prices go down?

In total, possibly fewer jobs - but not for our generation(s). The next few years will not be easy, but in my opinion the labor market will not experience a major downturn because especially the young employees need to be retained. Boomers will be gone soon and someone has to work in the next upswing.

That is the optimistic scenario. The pessimistic scenario knows no upswing.

And the view that a shortage of skilled workers is generally positive for us professionals is also too simplistic. We are now losing a lot of business because we don’t have the people. The business usually goes abroad... and once the customers have realized that good work can also be done abroad, for less money...

Then good night Germany as a business location.

Because if I can’t find a German company for my carport, then I’ll call Poland. German craftsmen currently operate under the motto "The customer will just have to wait, what else can he do..." He looks around abroad... the business for the German craftsman is not postponed... it is lost...

PS:
There can also be the extreme case that an entire department has to stop work because exactly one specialist is missing.
For example, if the metalworker loses the seam welder, who is essential... then he can either buy him in externally at an absurd cost... or he shuts down the operation...

And when interest rates start to fall again next year, the price spiral will begin all over again!

It won't happen that quickly. Inflation will still be around 2.3% next year. And interest rates don't immediately fall once the target of 2% is reached...

But even then. People have much less money in their pockets than in 2019. And construction prices have increased significantly again. Many will either no longer be able to afford the step into homeownership or will only be able to do so on a much smaller scale and with more personal effort.

Moreover, it also looks like the German automotive industry is facing strong competition from Asia, and the electric car generally requires far fewer manufacturing steps and less development effort than a combustion engine. Tens of thousands of highly paid jobs will be lost in the coming years...

it won't happen that quickly. Inflation will still be around 2 to 3% next year. And interest rates don't drop immediately once the 2% target is reached...

Even if inflation is only 3% y/y, the new price level remains "forever." Prices by definition are not allowed to fall back to, for example, 2020 levels – that would be deflation, and before that happens, the money printing machine will be turned on again. What previously increased by 9% – for example from 100 to 109 euros – will now cost 112 € (3% inflation).

Construction costs in certain details may become cheaper again, but will never reach the old levels. The remaining loss of wealth must be made up over years through wage increases. Otherwise, purchasing power remains permanently reduced.