The UK construction sector recorded a growth of 0.5% in the second quarter of 2011, which shows that the industry is recovering from a bad end to 2010 and early 2011, as freezing temperatures affected construction activity over the winter months.
The construction industry actually outshone other sectors, as the industry performed well compared to the rest of the economy.
The Chief Executive of the Construction Products Association, Michael Ankers said about the figures:
“Growth in private sector construction has finally begun to recover and although public sector construction output remains stronger than we had anticipated it is clear that the impact of the public sector spending cuts is still to be felt and is forecast to cause sharp falls later this year.”
That’s the thing, as we can’t bask in good news for once, as these figures don’t take into consideration the government’s spending cuts, which will be shown in the next set of figures for Q3 and Q4.
The spending cuts are expected to hit the public sector hard, which means the UK construction industry needs the private sector to step up if it wants to continue its growth in 2011, with the hope that big projects like the Green Deal can stimulate the industry.
Michael Ankers sums the spending cuts up, saying:
“These public sector cuts will begin to hit the construction industry in the second half of the year. With the continuing economic uncertainty and falling consumer and business confidence, we are forecasting that construction output this year will be slightly lower than in 2010.
But there are some positive areas to focus on, with Mr Ankers saying:
“Construction work is also very much focused in the South East and particularly Greater London where there are major projects such as the Olympics, Crossrail and a number of major commercial developments.”
This is evident by the large number of new projects going ahead in London, and an office boom in the capital, as construction work on Olympics projects reach completion. It has been well documented that the construction industry is struggling at the moment, as we are in the midst of a recession, and won’t really start to improve until 2013/14, but at least these signs are encouraging for 2011.
What do you think? What do you expect the construction industry to be like in the next year? Let us know what you think by commenting below:
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