Poor demand from the private sector will contribute to a slowdown in growth in Britain’s construction industry over the next couple of years, according to new research.
This year, construction output is expected to rise by 3.4%, states the report’s author Experian, down from 4.4% in 2003. In 2005, growth is forecast to slow a little more to 2.7%, before rising slightly to 3% in 2006.
James Hastings, associate director of Experian’s business strategies division, says the recession in the south of England had led to a sharp decline in commercial construction. “Despite a gradual improvement in Britain’s manufacturing industry, it is likely to be some time before this translates into new investment in industrial construction,” he said.
However, he added, public spending was at an all-time high, and with strict targets for social housing and education and health, both public housing and non-residential housing are set to grow at around 10% in 2004, before gradually tailing off.
“One area which has performed disappointingly is infrastructure,” said Mr Hastings, “where despite many large projects in full flow, output fell dramatically last year. The output remains uncertain for the sector.”
