CPA: UK construction activity will fall in 2013

The UK’s Construction Products Association (CPA) has today reported that it expects overall construction activity in the UK to fall by around 2 per cent this year, with most of the decline attributed to a greater than 5 per cent drop in commercial projects. Particularly concerning is the fact that the Government’s austerity measures with regard to public sector investment have not been offset by an increase in private sector activity. However these figures still represent an improvement on the 9 per cent fall of 2011. 

While road and house building continue to fair reasonably well with growth expected of 8 per cent and 6 per cent respectively, the largest sector  of the market – commercial construction – continues to suffer. Public sector construction will continue its recent trend by falling about 7 per cent this year, while big drops are also expected in retail (10 per cent), education (9.8 per cent) and health (8.7 per cent). Overall, the commercial construction sector is expected to fall by 5.7 per cent this year.

According to Noble Francis, the Economics Director at the CPA; ‘as the construction industry accounts for nearly 9% of GDP this contraction will be a major constraint on growth in the wider economy over the year ahead. Investment earmarked by the Chancellor in his autumn statement for road maintenance should provide some much needed activity across all regions of the UK, but it is important that this work is started immediately and used as a springboard for other economic activity if it is to have the desired impact.’

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