In the latest update, prospects for 2013 have been revised downwards from sluggish 0.4% growth predicted at the start of the year to output shrinking 1.3%.
The scale of work slide this year is likely to be slightly less than first feared and has been tweaked from a 5.2% fall to 4.5%.
This means construction output is now expected to drop almost 6% over the next two years, before a return to growth in 2014.
Once recovery starts in 2014 there will be a rapid rise in activity and growth is expected to remain buoyant for the foreseeable future, but until then construction is likely to have a significant drag on the UK economy as a whole, despite numerous government initiatives, which to date have had little impact in reinvigorating the economy.
Noble Francis, Economics Director of the Construction Products Association, said: “Between now and 2014, total construction is expected to lose £10bn as public sector construction activity falls away sharply.
“Although this has been expected for some time following the government’s deficit reduction plan announcements, the hoped for recovery in the private sector, which was expected to offset these falls, has not materialised.
“Medium term prospects are more encouraging, if government is serious about lifting the economy out of recession quickly, it needs to ensure that it focuses clearly on public and private investment, rather than a series of announcements and initiatives that lead to very little activity.”
- Construction output to fall 4.5% in 2012 and 1.3% in 2013
- Housing starts to fall 3% in 2012. The 3% rise expected in private housing is offset by a 23% fall in public housing
- Green Deal to have little effect on private housing repair, maintenance and improvement
- Commercial offices construction to fall 2% in 2012
- Rail construction to rise 55% in just three years
- Energy construction to rise 115% by 2016
Key predictions
Fallers
Risers
