Construction output drop prompts call for investment

June’s figures from the Office for National Statistics show a 0.9% drop in construction output compared to May.

1351235251_uk-graph-fallingIn response, the Civil Engineering Contractors Association (CECA) called on government to commit now to long term infrastructure investment in order to prevent economic decline across the UK.

Only a short period of the month was after the EU referendum; ONS said that there is very little anecdotal evidence at present to suggest that the referendum has had an impact on the figure.

For the quarter spanning from April to June output was estimated to have decreased by 0.7% compared with the first quarter of the year. Downward pressure on the quarter came both in new work, which decreased by 0.8%, and repair and maintenance, which decreased by 0.5%.

Output was estimated to have decreased by 1.4% between the second quarter of 2016 and the same period last year. CECA pointed out that infrastructure fell 10.1%: the largest fall since the second quarter of 2012.

CECA head of external affairs Marie-Claude Hemming said: “It is now imperative, in order to prevent recession that there is a fiscal stimulus from Government towards infrastructure investment which focuses on the delivery of projects within the existing pipeline and building the world-class infrastructure of the future.

“Our research has shown that for each £1 billion increase in infrastructure investment, UK-wide GDP increases by a total of £1.299 billion, yet figures from our first poll following the referendum show that the construction market is slowing just as the country needs it to speed up.”

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