The construction industry is lagging behind economic growth and will remain in recession, according to the latest construction forecasts from the Construction Products Association.
Although latest GDP figures indicate a continuation of recovery in the economy with 0.2% growth, the Association’s forecasts highlight a fall of 3% in construction activity during the first quarter of 2010.
Following last year’s 12% fall; the industry’s worst decline in more than 35 years, it is anticipated that by the end of the 2010 the construction industry will have lost £16bn of work in just three years.
At around 9% of GDP, construction is an essential part of the UK economy and if it remains in the doldrums, recovery for the economy as a whole is likely to be slow and protracted.
Construction Products Association chief executive, Michael Ankers, said: “This is not good news for the industry or the wider economy. The benefit of construction to the economy is well documented - for every £1 spent on construction, the economy benefits by £2.84.”
The Association also highlighted the importance of public spending to economic recovery, Ankers said: “The next government must understand the long-term significance of its actions; if capital spending falls below 2.25% of GDP our public services will begin to deteriorate and economic recovery will be delayed.”