But output forecast to return to growth in 2013 with offices, energy and housing seeing greatest gains
Construction output will continue falling over the next two years according to the latest forecast from the Construction Products Association.
However, the association predicted a return to growth in 2013 with the economic recovery expected to boost momentum by 2014.
Output this year is forecast to drop 0.5% followed by a greater fall of 2.8% next year as a result of curtailed public sector expenditure.
A 0.2% rise in output is predicted for 2013 – and growth will leap 3.4% in 2014.
Noble Francis, economics director at the CPA, said: “The overall prospects for the next few years are very poor.”
“The Government has identified construction as a key driver to help boost economic recovery and for private sector work to replace public sector.”
“Although the public work is now beginning to decline and will fall by 24% by 2014, there is little evidence that the private sector work will replace this over the next couple of years.”
The decline in output will be offset by a 50% rise in office building over the next five years – with most of the work centred in London and the South East.
By 2015 a three-fold increase in construction is forecast for the energy industry and output in the private housing sector will rise by 62% by 2013.