SHARP CONSTRUCTION FALL ADDS TO DEEPENING UK RECESSION

Today’s GDP figures from ONS show that the UK’s recession deepened further in the second quarter of 2012, led predominantly by further sharp falls in construction activity.

And yet the Chancellor cites the Government’s investment in construction projects as evidence that they are investing in growth. The problem is they’re not! The truth is, despite the great fanfare, most of the recent announcements about investment in infrastructure projects won’t start for several years.

Whilst overall, the UK economy shrank by 0.7% between Q1 and Q2, construction fell by a staggering 5.2% over that same period, indicating that the construction sector is now in a really deep depression.

Commenting on these figures, Noble Francis, Construction Products Association Economics Director said: “Although the vast majority of commentators have been predicting continuing recession, very few will have expected such a sharp fall.

“For construction the position is now very worrying, as although we have known for some time that public sector activity would begin to decline, because of the government’s deficit reduction plan, the hoped for recovery in the private sector has not materialised. As the construction sector is such a key part of the economy, until we see recovery in construction, we will not have the economic growth the UK needs.

“According to our latest Forecasts, which were published this week, construction is unlikely to return to growth until 2014. Government has acknowledged that construction will be a part of the solution for our economic woes, but if they are serious then they must act now to stimulate growth and drive recovery.”

Sadly, this Tory-Lib Dem Government just doesn’t get it. It’s like Messrs Cameron, Osborne and Clegg have metaphorically thrown the economy out of an aeroplane at 30,000 feet without a parachute saying something like: ‘flap your arms about a bit and you’ll be fine’. The only snag is the economy has hit the ground with an almighty splat, yet Messrs Cameron, Osborne and Clegg keep telling us there is no alternative to the parachuteless plan.