The comments were made at the launch of the association's annual workload report for 1998.
The association said transport infrastructure accounted for about 34% of all engineering work in the UK, and is the largest single market for ACE members. However, the report showed spending on roads, bridges and tunnels dropped during 1998. At the same time, spending on railway improvement programmes edged up, but overall transport infrastructure work was slightly down on its 1997 figure.
ACE board member Brian Clancy said the current government trend to fund one transport sector at the expense of another would damage the engineering industry.
"We are concerned about what's happening to road policy in the UK. Firms that have to employ engineers with rail experience will end up losing others with road, bridge and tunnel experience." The report showed gross fees earned by members had risen 31% in the UK during 1998. However, just 2% of new work came from private finance initiative schemes, down from 1997's figure of 8%. Clancy said it was "worrisome" that the proportion of work attributed to PFI had shrunk, but said he was encouraged that a number of smaller engineering firms were involved in PFI projects as client consultants and subcontractors.
He added that, overall, the UK results were encouraging and an indication of the current healthy state of the British construction market.
The survey also showed a 6% decrease in the amount of overseas work won by UK engineers.
Clancy blamed the continued economic crisis in the Far East for the fall in work but added that the region remained the largest international market for engineers, accounting for more than 43% of all overseas work.
China accounted for 10% of the Far East market in 1998. "We think that 1998 is the bottom of the trough internationally. "We don't want to sound like Norman Lamont, but there are green shoots of recovery," said Clancy.
The CIPS purchasing managers' monthly report for April shows a rise of about 3% in new construction orders.
It also records an increase in construction employment for the first time in seven months.