Construction Recovery Peters Out as Economy Goes into Reverse

The GDP figures published today by ONS show that construction output fell by 3.3% in the final quarter of 2010, the largest fall since the height of the recession in early 2009.

Commenting on the figures, Construction Products Association Chief Executive, Michael Ankers, expressed concern regarding the impact of the sharp downturn in the wider economy on construction: "After 2 quarters of relatively strong growth in the middle of 2010, these latest figures show that the economic recovery has stalled even before the full impact of the public sector spending cuts is felt. Although the poor weather in the last few weeks of the year undoubtedly had an impact on the construction industry, as it did in 2009, it is clear that the recovery in the construction industry has already petered out and that private sector growth is not coming through strongly enough.

"The Construction Products Association is forecasting that construction output will fall a further 2% in 2011 and this will inevitably hold back the pace of recovery in the wider economy. It is essential that the government does more to encourage a private sector led recovery by accelerating the measures it is taking to reduce the burdens on business, encouraging the banks to make more money available for viable business investment, and implementing the measures it is committed to for improvement to the infrastructure of this country. It also needs to ensure that its broader policy objectives on localism help stimulate rather than hinder economic growth."