Construction shrank by 5.2% in the second quarter of the year, according to new provisional Government statistics.

The dismal performance compounds a 4.9% construction drop in the first quarter of 2012.

Overall, the UK economy experienced a 0.7% drop in GDP – the biggest fall in quarterly UK economic outlook since the first three months of 2009.

The third successive quarterly drop was much sharper than the 0.2% contraction many economists predicted.

The latest figures raise the pressure on the Government to come up with an immediate stimulus for building, rather than more longterm strategic infrastructure goals embraced so far.

Simon Rawlinson, Head of Strategic Research & Insight at EC Harris: “It should be noted that these GDP figures are seasonally adjusted, so the fact that they are so grim even with this adjustment shows just how bad things are.

“Over the past few months, construction output data has been declining steadily, so a further fall in construction and, therefore, GDP should not be too surprising.

He added: “Last week’s announcement by the Government that it will back funding in infrastructure was very welcome, but it will not have an immediate effect on GDP.

“Overall, I think the UK economy may have bottomed out over the past quarter, and should rebound during the rest of this year, however I fear that construction will continue to struggle.

“There is no sign of an increase in aggregate construction orders, so this sector is likely to decline further.”

Noble Francis, Construction Products Association Economics Director said:  “For construction the position is now very worrying, as although we have known for some time that public sector activity would begin to decline, because of the government’s deficit reduction plan, the hoped for recovery in the private sector has not materialised.

“As the construction sector is such a key part of the economy, until we see recovery in construction, we will not have the economic growth the UK needs.”

The Office of National Statistics underlined that the figures were provisional and said it was not yet sure of the effect of the extra June bank holiday and the poor weather.