Construction output dropped last year for the first time in 11 years, according to economic forecasting group Experian.

Output fell by about 0.5%, but Experian predicts the industry will pick up this year with a modest growth of around 1.7%.

Experian’s National Construction Forecast says the industry’s rate of growth should strengthen until to 2008.

Public sector output in 2005 has been weaker than previously forecast, with new public housing down by 7%, which researchers said was “surprising” considering the pressure to deliver increasing levels of affordable housing.

Public non-residential construction is likely to have dropped by 8%, while private sector housebuilding has been stronger than forecast, with just a slowdown in growth recorded.

James Hastings, Experian’s head of construction futures research, said: “The construction industry proved not to be immune to the general slowdown in the economy in 2005, with only the private housebuilding and public non-residential repair and maintenance sectors performing better than expectations.”