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A bleak prospect - construction output to fall by a record 16%

The Construction industry is to face even harsher economic times ahead according to forecasts published today by the Construction Products Association.

The CPA predicts that the industry will see a sharp deterioration in prospects and does not expect any significant increase of construction output until 2012.

According to these forecasts, output will fall by a record 16% in 2009 compared to the April forecast which indicated a fall of 12%.

Prospects for 2010 have also declined with the Association now forecasting a fall of 5% compared to the previous forecast which showed a fall of 3.4%.

“Prospects for the industry have deteriorated significantly over the last three months with new orders for construction work falling at a record rate,” said Construction Products Association chief executive Michael Ankers.”This year we expect the industry to suffer its largest fall ever experienced in a single year and with a further fall in output in 2010, output will have fallen faster in these two years than any of the previous post war recessions.

“The impact of the recession on the construction industry has already been devastating, with hundreds of thousands of jobs lost and people with key skills leaving the industry. Manufacturing capacity has also been severely reduced and lack of skills and capacity will be a serious constraint on the pace at which the industry can recover”

Other key aspects of these latest forecasts are:

  • Offices - construction to fall by 50% in less than two years
  • Retail - new build to fall by 42% by the end of 2010
  • Rail - construction to increase almost threefold by 2013
  • Industrial construction - in 2012 to be worth less than half its value in 2007.

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