Sharp construction fall causes deepening UK recession

Sharp construction fall causes deepening UK recession
26 July 2012

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

The UK economy shrank by 0.7 per cent, marking its third consecutive quarter of contraction and the longest recession the country has faced in 50 years. However, construction fell 5.2 per cent over that same period, indicating that the construction sector was now in a deep depression, despite a number of recent initiatives by government to spur growth.  

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.”

Published under Cement News