Industry slams official construction output figures

Aaron Morby 12 years ago
Share

A wide-ranging trade survey has challenged the Government view that construction output surged by 4% between July and September.

The respected Construction Trade Survey paints a far gloomier picture of falling output and dwindling orders among contractors and suppliers.

Its findings stoke up industry concern that the Government is basing policy decisions on Office of National Statistics figures that are out of kilter with reality.

The wide-ranging survey warns that prospects for construction during the rest of 2010 look increasingly unsure.

Contractors highlighted falls in output in the third quarter, supported by product manufacturers that said sales of both light and heavy side products were down over the same period.

Firms are now deeply fearful about future prospects following confirmation that public capital expenditure will fall 30%.

Noble Francis, economics director at the Construction Products Association said: “The Trade Survey for 2010 Q3 highlights that the environment for contractors and product manufacturers is still extremely challenging, especially given that the public sector accounts for more than one third of total construction output.

“Despite a number of high profile contracts being let within the commercial offices sub-sector in central London, 71% of contractors, on balance, reported that order books fell in the third quarter.

“Of great concern, in the light of the CSR, 67% of contractors, on balance, reported that order books fell in the third quarter in public non-housing, which covers education and health construction.”

Stephen Ratcliffe, director of the UK Contractors Group, which also supports the survey, said: “This paints a picture quite different from the official growth figures which suggest – wrongly in our opinion – that construction is the engine driver of economic recovery.

“While there are still good opportunities – notably infrastructure – the outlook remains uncertain.

He said that the new government has made a good start in setting out its public sector investment plans but warned the whole picture has not yet been filled in.

The energy white paper is not due out until Easter next year and the industry has real concerns that the decentralisation of decision making will slow up both the planning and procurement of new public sector investment projects.

Julia Evans, chief executive of the National Federation of Builders, added: “Despite official figures showing impressive industry growth, the industry’s own figures point to a fall in output, falling prices and fewer enquiries. This all points to a depressing Christmas for the industry.”

Key survey findings

  • 22% of contractors, on balance, reported a drop in output in 2010 Q3
  • 51% of building contractors reported that tender prices fell during the third quarter of 2010 compared to the previous quarter
  • 10% of light side manufacturers and 29% of heavy side manufacturers endured a fall in sales
  • 23% of light side and 14% of heavy side product manufacturers reported that they anticipated a significant rise during the fourth quarter
  • 95% of light side manufacturers and 92% of heavy side manufacturers reported, on balance, that in third quarter of 2010, unit costs were higher than one year earlier, driven by rises in raw materials costs and fuel/energy costs
  • 88% of light side manufacturers and 36% of heavy side manufacturers reported that on balance, employment fell in the second quarter of 2010
  • 19% of light side manufacturers and 18% of heavy side manufacturers warned that employment was likely to fall further

Latest news

Administrator details confirmed at Southampton M&E firm

Begbies Traynor now in charge at Working Environments as suppliers face large losses
5 hours ago

Applicant numbers nosedive for construction vacancies

Recruitment market gets even more competitive - how the Enquirer can help
9 hours ago

Housing association shuts in-house modular factories

Swan closes loss-making steel frame and cross-laminate timber factories
11 hours ago

350-homes approved around iconic London Tube station

Housing blocks to be built around Grade II-listed Hounslow West Tube station
11 hours ago

Domis set for £195m Boddingtons Brewery scheme

Developer Salboy buys Manchester site to kickstart long-awaited 556 homes project
13 hours ago

John Lewis £500m funding deal to build 1,000 rental homes

Deal to advance BTR flats at store sites in Bromley, West Ealing and Reading
1 day ago

Esh launches new housing retrofit division

Esh Retrofit Solutions will target market to improve the energy performance of social rented homes
13 hours ago

Eric Wright wins tricky £52m Liverpool transformation

Contractor working with engineers at Ridge and Partners on "challenging" Stanley Lock Flight site
3 days ago

Investment giant buys Bristol M&E contractor

RDCP Infrastructure acquires Avon Combined Electrical Services
3 days ago

Demolition start for £50m Farnworth town centre rebuild

Caddick Construction is tipped for main works due to start in the spring
4 days ago

L&G Modular strikes deal to build 1,000 affordable homes

Modular homes business teams up with Hampshire's Vivid housing association
4 days ago

Former Erith operations director joins John F Hunt

Scott Exell named new operations director at demolition specialist John F Hunt
4 days ago

Green light for £135m Leeds twin tower resi scheme

Construction to start in New Year on 500 build-to-rent apartments
4 days ago

Mace hits 1m tonnes carbon saving target for clients

Present work pipeline betters 2026 carbon emission saving target
4 days ago

Plans in for £40m surf park at former Kent colliery

Seahive surf lagoon and health resort will be built near Deal
5 days ago

Crushed demolition worker vows to return to industry

Shannon Brasier hoping to return to construction following horror accident
4 days ago

Mount Anvil to start 900-home North London estate rebuild

Planning approval paves way for Barnsbury Estate rebuild in Islington
4 days ago

Green light for major laboratory campus in Cambridge

Developer BioMed to tender first building on 600,000 sq ft lab complex in the New Year
5 days ago

Belfast firm signs the biggest work deal yet under Project Gigabit

Fibrus to hook-up rural Cumbria to lightning-fast broadband under £108m deal
4 days ago

McLaren wins Leeds logistics park contract

Work to start imminently on warehouse complex for Firethorn Trust
5 days ago

Work restarts on £683m waste power plant after site death

Construction suspended for a week of investigations following fatality
5 days ago

Demolition starts on £135m Wigan Galleries scheme

Contractor BCEGI starts work on project to redevelop Wigan town centre
6 days ago

Amey CEO to step down following private equity buyout

Amanda Fisher to leave once business is transferred to new owners
5 days ago

New body set up to vet plant operator card schemes

Contractor trades bodies unite to tackle competency concerns over plant operator skills cards
5 days ago

Kier leads switch to hybrid battery generators

Battery units work alongside smaller generators cutting run times by nearly 60%
5 days ago

Plans in for first Leeds co-living scheme

Watkin Jones submits plan to convert old Direct Line HQ into 230 studio flats
6 days ago

Demolition worker crushed by excavator

Court hears 20-year-old woman was left with "life changing injuries"
6 days ago

Government pays £700m for 50% stake in Sizewell C

New body, Great British Nuclear, will be set up to develop pipeline of nuclear projects
6 days ago

Costain wins Heathrow Airport asset renewal deal

Firm takes early contractor involvement role in Terminal 2 baggage handling upgrade
6 days ago

Worker killed on £683m waste power plant site

Fatal collision involving heavy goods vehicle on giant north London site
7 days ago

Contractor services