Today’s figures from ONS for GDP in the first quarter of 2012 show that the UK economy and construction industry returned to recession with a fall of 0.2% fall and 3% respectively.
Noble Francis, CPA Economics Director said: “Given the sharp effects of public sector spending cuts over the past 12 months it is unsurprising to see that construction returned to recession in the first quarter with a fall of 3% following the 0.2% fall in Q4. Furthermore, with new orders for construction falling 14% in 2011, the industry is likely to endure further falls near-term.
“Our latest forecasts for construction anticipate that the industry will fall considerably this year and remain flat in 2013, severely delaying recovery for the economy as a whole.
“Given that independent economic analysis has shown clearly that for every £ spent in construction, £2.84 is generated for the wider economy, it is essential that government does its utmost to switch its current spending towards the more productive capital spending.”