CIF president Frank McCafferty said that the figures had been revised down because a 5% fall in private construction investment and an 11% decline in housebuilding was expected.
McCafferty said that the main growth point this year would be in the public sector, with a 12% rise predicted.
CIF public affairs spokesman Kevin Gilna said US firms had either scaled back current projects or delayed future investments in the wake of the slowdown in the US.
Gilna cited the example of technology giant Intel, which stopped work on a scheme in Leixlip, Co Kildare, in March as an indication of what was happening.
The Celtic tiger is not dead – but it is not roaring as loudly as it used to
John Hodges, RGCM project manager
The fall in US investment could lead to a decline in the number of UK and US construction firms seeking work in Ireland as the market becomes more difficult. Construction output rose 10% last year and in 1999.
Construction manager RGCM, which opened an Irish office last year, said the boom had settled down. Project manager John Hodges said: "The Celtic tiger is not dead - but it is not roaring as loudly as it used to." Hodges added that demand for housing was still very high in Ireland.
He said not as many foreign firms were looking for work, noting that some Irish contractors were also making life more difficult for outsiders by becoming more competitive. But Gilna said there was still a need for foreign contractors and consultants to work on large scale complex projects, especially infrastructure.
The CIF also criticised the Irish government for taking too long over putting its National Development Plan into action. CIF director general Dr Liam Kelleher said: "Eighteen months into the NDP the Irish contracting industry would like to see projects being brought to the construction stage faster. At this point they are looking for work."