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Public sector output fall points to difficult 2012

The latest construction figures released by the Office of National Statistics, showing that output fell 6% in May, indicates a bleak outlook for construction during 2012.

Noble Francis, economics director at the Construction Products Association said: “Although the coalition has consistently made pronouncements of boosting UK construction and the economy, there is little sign of this in reality. Public sector housing output in May was 23% lower than a year earlier and in the three months to May was also 23% lower than a year earlier. Public non-housing output, which primarily covers education and health construction, during May was 20% lower than a year earlier and in the three months to May was 22% lower than a year earlier.

“Private commercial, the largest construction sector, continues to be the key bright area of construction. Commercial output in May was 2% higher than a year ago and in the first five months of the year was 1.3% higher than one year ago. However, this is not enough to offset the public sector cuts and, overall, in the first five months of the year, construction output was 5.4% lower than a year earlier so prospects for the year as a whole are bleak.

“If government is serious about recovery in UK construction and the economy, it clearly needs to focus on getting a replacement for PFI sorted out immediately, getting work on the ground now by focusing on repair and maintenance and ensuring that the Green Deal becomes a success by giving householders greater incentives to invest in energy-saving improvements.”

About Fiona Russell-Horne

Fiona Russell-Horne
Group Managing Editor across the BMJ portfolio.

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