Construction output to fall further

New orders data released by the Office of National Statistics (ONS) show that total construction orders in the three months to November fell by 27% compared to a year earlier, the largest fall since records began.
Private housing was also down 55% compared to the same period one year ago.

Commenting on the data, Noble Francis, Economics Director at the Construction Products Association said: “Previously the main effects of the slowdown have been on small and medium sized contracts, with larger contracts taking an increasing proportion of total orders.

“However, it now appears that the larger contracts are suffering more than ever and the industry is hugely dependent upon public sector work. This is reflected in the orders’ figures with public non-housing orders for the quarter to November 43% higher than the same quarter one year earlier.”

“As a consequence, the government has a crucial role in restoring confidence in the economy and its future prospects so that businesses can begin to invest and consumers can feel confident enough in their own prospects to start spending. For this to happen it is essential the government ensures the delivery of much needed investment in infrastructure and other public construction projects; these are vital to the country’s long term economic growth.”

The Association has written to the government and is urging immediate action in a number of areas to help the government address this growing problem and kick starting economic activity.

The areas highlighted are: investment in transport infrastructure, energy capacity and storage, social housing and flood defences, improved delivery of projects, increased credit availability and the further encouragement of energy saving.

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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