UK recovery hindered by construction recession
Published:  26 April, 2010

LONDON: The construction industry is lagging behind overall UK recovery and will remain in recession, according to the latest construction forecasts from the Construction Products Association.

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, said the association.

Its forecasts highlight a fall of 3% in construction activity during 2010 following last year's 12% fall, the industry's worst decline in more than 35 years. And by the end of 2010, it anticipates the construction industry will have lost £16b of work in just three years. Growth is not expected to return until 2011 and even then, it is forecast to be relatively subdued at just 1% per year is 2011, 2012, and 2013.

Michael Ankers, CPA chief executive said: "This is not good news for the industry or the wider economy. The construction industry is such a major part of the economy that it is hard to see how there can be a strong recovery whilst construction remains in recession. The benefit of construction to the economy is well documented - for every £1 spent on construction, the economy benefits by £2.84."

The association said it is critical that public spending on schools and housing, as well as in energy and transport infrastructure, is not cut sharply, otherwise recovery for the construction industry could be delayed and economic recovery for the UK could be severely hindered.

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