Output to slide for another 18 months

Grant Prior 12 years ago
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Industry experts fear output will continue to fall for another 18 months following another grim set of government construction figures today.

Latest ONS construction statistics show a 9% drop in output during April compared with 2011 and an 11% fall on the previous month.

Construction Products Association Economics Director Noble Francis said the downward trend could last another 18 months.

He said: “The government has made much play of private sector construction leading the recovery as the public sector cuts bite but it is clear that this is not the case.

“Overall, construction output fell in every sector during April.

“With further public sector cuts in the pipeline and little to suggest that a resolution to the euro zone crisis is imminent, it is clear that the trend in output during the next 12-18 months will be downward.”

Steve McGuckin, managing director of the construction and programme management consultancy Turner & Townsend, said:”These latest numbers  suggest that the construction industry’s challenges aren’t as bad as we thought. They’re worse.

“The hope persists that the private sector will ride to the rescue of a sector that’s been hit particularly hard by the decline in public spending. But these figures clearly show that it hasn’t happened yet.

“The pain isn’t being spread equally over the regions either – with South East England proving more resilient than almost everywhere else.

“Demand is still there, but competition for work is very intense. The major players are surviving, even if their margins have got steadily tighter.

“Niche players who excel at what they do are also bearing up well, but it’s the middle ground – non-specialists whose services are commoditised – who are most at risk.”

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