Index shows 10 months of contraction and tenders drying up while redundancies double

The UK construction industry suffered a record decline in December 2008, with all sectors of the industry suffering their worst contraction on record.

The most recent figures, from the Chartered Institute of Purchasing and Supply (CIPS)/Markit construction index, revealed a fall to 29.3 from November’s 31.8.

This was the 10th successive month that the index has been below 50, which is the level indicating contraction within the industry.

The level of new orders placed with UK construction companies fell at the steepest rate in the history of the index. Companies indicated that tender enquiries had dried up.

Housing suffered the sharpest decline, while both civil engineering and commercial construction fell at record rates.

Subcontractors were forced to lower their rates for a fifth month in succession, and at a survey-record pace in December.

Meanwhile, labour market statistics revealed that redundancies across the industry had more than doubled within just one year, with figures hitting 31 000.

Within m&e, Unite Amicus national officer Tom Hardacre said: “With regards to capital development, we haven’t seen a major difference yet, but the repair and maintenance side of things has taken a hit, and there have been considerable redundancies within that sector.

He added: “We’re all concerned that the overall m&e situation could get worse.”