Output to fall for two years before 2013 bounceback

Grant Prior 11 years ago
Share

Industry forecasters are predicting a fall in construction output this year and a further drop in 2012.

Worrying predictions from the Construction Products Association forecast a drop in output of just under 1% in 2011 and by a further 2% in 2012.

The falls will hit as private sector construction fails to match the sharp downturn in public sector spending.

Association chief executive Michael Ankers said: “It is especially worrying that the construction industry is going to face another two years of falls in output, particularly given it is an industry that has been identified in the government’s Growth Plan as having a key part to play in the economic recovery.

“Significant cuts in public spending are inevitable whilst the private sector remains cautious about the pace of the wider economic recovery and consumer confidence remains at low levels.

“We welcome the steps that the government is taking to stimulate private sector growth but we do not see these in the short term as being sufficient to outweigh the public sector cuts.

“Availability of finance remains an issue for many companies and the housing market is still being held back by the lack of finance available, particularly for first time buyers.”

The association has produced a wish list for the government to stimulate the construction sector. It wants ministers to:

  • Continue to put pressure on the leading institutions to make finance available for house purchase and ensure that the range of initiatives introduced in the recent Budget actually work
  • Make sure that planning authorities around the country adhere to the requirement to make a presumption in favour of sustainable development
  • Ensure that the localism agenda acts as a stimulus for growth in local communities and does not create a ‘nimby’s charter’
  • Try to accelerate the programme for investment in energy supply so that companies have an increased confidence about investing in the UK
  • Introduce incentives to encourage householders to invest in the energy efficiency of their homes in advance of the Green Deal policy being introduced at the end of next year.’

Key elements in the latest forecasts are:

  • The construction sector is forecast to fall 0.8% in 2011 and 2% in 2012 before rising 0.5% in 2013, 2.3% in 2014 and 3.9% in 2015
  • Construction output in 2012 is expected to be 3% lower than the pre-recession peak in 2007
  • Public sector construction work to fall £11bn by 2015; key areas to suffer falls in work include education, where work is expected to fall 53%, and health, where work is expected to fall 27%
  • Private sector construction work to rise £15 billion by 2015; key areas expected to grow include commercial offices and retail, expected to rise 14% by 2015 and both infrastructure rail and energy, where work is expected to double in the next five years
  • Even after five years of consecutive growth, private housing starts in 2015 are still expected to be 16% lower than in 2007, the pre-recession peak

Latest news

Construction arm propels Mace to record profit

Revenue expected to top £2bn this year despite project delays
19 hours ago

Fire destroys conveyor belt at Silvertown Tunnel site

Forty firefighters battle blaze at huge London site
9 hours ago

Social housing bidding opens for £1.5bn energy retrofit cash

First upgrades of social housing stock could start from early next year
50 mins ago

Plan for £58m Bristol pharma R&D facility approved

Willmott Dixon in line to build the R&D facility at Bristol & Bath Science Park
4 mins ago

Bond Street Elizabeth line station to open next month

Final station on delayed line will welcome passengers in October
4 mins ago

Sisk fixes price on £227m Quintain flats job

Quintain signs single-largest contract so far at Wembley Park
21 hours ago

Green light for St Helens town centre revamp

English Cities Fund to start phase 1 next April
55 mins ago

Rising costs tip William Hare to £3.6m loss

Specialist contractor falls into the red despite near 60% revenue rise to £220m
2 days ago

Safety blitz on “aches, pains and strains” on site

1,000 site visits planned in coming months to check how workers are moving heavy or bulky materials
2 days ago

Drones sent flying underground to check sewers

Traditional inspection teams replaced with latest technology
1 day ago

Plan submitted for 470 Preston flats scheme

Stoneygate Central scheme on Dryden Mill site will rise to 16 storeys
24 hours ago

Graham starts £124m M25 Junction 28

Work on the 36-month Junction 28 upgrade includes constructing a major two-lane loop road
23 hours ago

Keltbray bags brace of energy infrastructure wins

Civils work on huge converter stations worth £30m to specialist
2 days ago

Balfour Beatty sole winner for £4bn Scape civils deals

Contractor reappointed to England, Wales and Northern Ireland and separate Scottish deals
2 days ago

PR expert Baroness Rock to chair Costain

Kate Rock will take up senior board role at the end of the year
2 days ago

Billington profit upgrade after strong first-half

Steelwork contractor says weaker pound will allow it to reignite its old export markets in Europe
2 days ago

Green light for £120m Liverpool “super restaurant”

Historic Pumphouse at Stanley Dock to be transformed
3 days ago

Tolent bags £15m Sunderland skills academy

Work to start later this year on Housing Innovation and Construction Skills Academy
2 days ago

Government launches net zero review

Pro-growth and pro-business review of net zero 2050 target launches
3 days ago

L&G Modular wins 400-home Wolverhampton job

Modular specialist wins 17-acre Canalside South regeneration scheme
3 days ago

£1.2bn A12 upgrade accepted for planning

15-mile Essex road upgrade between Chelmsford and Colchester aims for 2023/24 start
3 days ago

US consultant trumps WSP bid for RPS Group

Tetra Tech swoops but WSP could come back with new offer if bidding war breaks out
3 days ago

Sisk hands staff £900 cost of living cash boost

Firm also promises staff £400 Christmas voucher in November
3 days ago

Loathed IR35 reforms scrapped by Chancellor

Contractors will no longer have to determine tax status of freelance workers
6 days ago

Higgins signs deal for 740 West London homes

Work to start this autumn on two Hayes housing estate rebuilds
3 days ago

Kier wins Sefton net zero £36m school job

Deyes High School in Maghull will consist of 60 classrooms
3 days ago

Giant TBM cutterhead takes road trip to second drive

Balfour Beatty Vinci to drag remaining TBM back through tunnel for second bore
6 days ago

Fast-track 138-project growth plan – full list

Chancellor banks on road projects to lead growth plan recover
6 days ago

Kwarteng backs construction to lead “new era for Britain”

Planning rules to be ripped-up to speed infrastructure work as 38 new Investment Zones created
6 days ago

Green light for next two Manchester NOMA jobs

Work to start early next year on first of two major office buildings
6 days ago

Contractor services