Higher government spending will be crucial to sustain current growth trends in the construction industry over the next three years. This is due to the slowing of private sector generated work, according to the Construction Products Association’s industry forecasts.

Michael Ankers, the Association’s chief executive, said: “Although private sector growth is forecast to constrain activity over the next three years, government spending continues to keep the industry optimistic, with public sector output forecast to grow by 7·5% in 2004, 3·1% in 2005 and 2·5% in 2006.”

He stressed that oversupply in the office market will depress further speculative developments in the sector. Higher interest rates are also predicted to have a negative impact on the current boom in housing construction, and a knock-on effect in the retail and leisure markets.

Source

Electrical and Mechanical Contractor