The construction industry is a barometer of how well the economy is doing – and as everyone knows, it’s doing very badly under the stewardship of this Tory-Lib Dem Government.
Forecasts out today show more gloomy news for the industry in the coming 12 months. Public Sector construction is set to fall by a further 18% up to 2014. Education construction is predicted to plummet by one quarter in 2012, while health construction is set to decrease by 15% this year.
The only light at the end of the tunnel for the construction industry is that infrastructure construction should see an increase of 20% by 2015 and energy construction a threefold rise over the same period.
But overall, construction output is forecast to fall by more than 5% this year and remain flat throughout 2013. It will be 2014 before the industry is expected to see any significant signs of recovery, by which time output will be 12% lower than at its peak in 2007.
Michael Ankers from the Construction Products Association says: “For the construction industry to return to growth there needs to be a strong private sector recovery, but this is just not happening. Continuing uncertainty about the future of the euro zone and a lack of consumer confidence in the UK are holding back important investment decisions. As a result the largest area of construction activity - private commercial work- is forecast to fall by a further 5% in 2012 and remain at that level in 2013.
“At the same time the cuts in public sector construction activity are really beginning to bite, with construction work on schools, hospitals, and other non-housing work forecast to fall by 23% compared with 2011. Despite the encouraging announcements on public sector investment on infrastructure projects in the Autumn Statement, capital spending on construction will still fall 30% by 2013.
“Although new housing starts in the private sector are set to continue their slow recovery, in the short term these are more than offset by the sharp fall in public sector housing. As a result the number of new homes started in 2012 is forecast to be 5000 fewer than this year, and at just 113,000 this is less than half the number of homes needed to accommodate the additional number of households expected to be created over the next 12 months.”
This is yet more evidence of the disastrous economic path being pursued by George Osborne, which is undermining growth and failing to reduce the deficit or the national debt. The Government needs to embrace a Plan B – and quick – or the implications for unemployment and community cohesion will be terrible.
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The reason that most of the general public do not trust Labour on the economy is that they led the country through an unprecedented debt fuelled boom followed by a massive bust. They were given 13 years and they produced an economic mire.
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