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New construction orders at lowest level since 1980

Construction order figures fell 16.3% in the second quarter of 2011 against first quarter figures — meaning that the total volume of all new orders is now at its lowest total since the third quarter of 1980, according to the Office of National Statistics.

The figures, released today, also showed that orders for that quarter were down 23.2% on the same period last year. Private industrial was the only sector that showed a positive growth from the first to the second quarter (6.6%).

The Civil Engineering Contractors Association (CECA) called the figures “shocking” and said it was “extremely concerned”, citing the impact of public sector spending cuts combined with a lack of confidence on the part of the private sector to invest in new construction.

“It’s hard to see any silver lining on this particular cloud,” said CECA director of external affairs Alasdair Reisner. “No one was expecting stellar order figures, bearing in mind the impact of public spending cuts and the more general economic environment both here and abroad, but it’s the sheer scale of this drop that is concerning.”

However, others said there were likely to be brighter times ahead. “Confidence is now at its lowest level for eight months, but my view is that there is no need to break out the ‘end is nigh’ sandwich boards,” said construction consultant Turner & Townsend UK managing director Steve McGuckin. “There is a substantial lag between what’s seen by the contractors — who are the focus of this survey — and the consultants in the vanguard of the industry. In many ways, the contractors are now feeling the pressure that consultants went through a year or two ago.”


Readers' comments (1)

  • “There is a substantial lag between what’s seen by the contractors — who are the focus of this survey — and the consultants in the vanguard of the industry. In many ways, the contractors are now feeling the pressure that consultants went through a year or two ago.”

    So where exactly is the good news in that statement Mr McGuckin? The only thing that I can glean from this is that even if Consultants started today on design commissions then it would take at least up to two years before it gets to market. For many contractors that will be too late - I would certainly dust off the "end is nigh" sandwich boards in preparation for second quarter of 2012. Perhaps Mr McGuckin can be interviewed again after more company failures have hit the headlines.

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