Construction output is forecast to fall by 6.3% this year and a further 1.4% next, before a return to growth in 2014 according to the latest Construction Industry Forecasts published by the Construction Products Association.
This decline will mean a reduction of almost £8.5bn of construction activity over these two years, undermining the ability for construction to lead the UK’s economic recovery.
Noble Francis, CPA economics director said: “Construction is currently experiencing sharp falls, both for orders and output as a result of severe cuts in the government’s capital spending, coupled with a very subdued private sector recovery. Construction has already lost £4.5 billion of work this year as the industry returned to recession for the third time in five years. Prospects for the industry going forward are bleak.
“Although growth is expected in 2014, the next 12-18 months are likely to cause considerable pain to an industry that is already reeling from a prolonged decline. Considering how important construction is to the economy as a whole, and how many times government has stated that construction is essential for recovery, these latest forecasts will do nothing to improve confidence in the UK economy.
Key findings in the Forecasts include: