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Contractors gloomy after shocking construction figures released

Shocking figures on construction figures for the first quarter of 2011, released today by the Office of National Statistics (ONS), add weight to contractors’ concerns for the future health of the industry, says the Civil Engineering Contractors Association (CECA).

The figures show that new construction orders fell by 23% for the first quarter of 2011 compared with the fourth quarter of 2010 and by 18% compared with the same period in 2010. This makes it the worst quarter for the industry since the first quarter of 2009.

Orders for infrastructure were particularly hard hit, falling by a remarkable 48% compared with the previous quarter and by 45% compared with the same period a year earlier. Just £1.97bn of infrastructure orders were made during the quarter, compared to £10bn across the whole of 2010.

The findings confirm the conclusions of CECA’s own Workload Trends Survey for the first quarter of 2011, which includes a section on orders, which found on balance 20% of CECA members were experiencing fewer orders than during the previous quarter.

CECA director of external affairs Alasdair Reisner commented: “As a major contributor to UK economic growth it is vital that the construction industry returns to growth.

“But the ONS figures show that the orders needed to drive growth are drying up, putting the industry at real risk of further decline.

“It is particularly worrying that these figures do not yet show the full effects of cuts to public sector investment coming this year. It had been hoped that private clients would fill this gap, but the fi gures show that even here orders are dwindling, so it is difficult to see where growth is likely to come from in the future.

“We are particularly concerned by the dive in infrastructure orders, which fell 48% in the quarter. While this is in part due to an unusually high level of orders in the previous quarter, we would have hoped to see growth in orders in this area, as the government has repeatedly stated that it views the delivery of new and improved infrastructure as central to its economic growth strategy. If orders remain low, it suggests more work needs to be done to remove the barriers to investment in this vital sector.”

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