New UK construction orders fall more than 15%

The prospects for construction output weakened still further as the latest new orders figures from the Office of National Statistics for the final quarter of 2011 showed a fall of more than 15% compared with the same quarter one year earlier.

Commenting on these figures, the Construction Products Association Economics Director, Noble Francis said:  "It is extremely concerning to see the ONS figures for construction new orders, which give the clearest picture of how the industry will pan out in 2012 and 2013, decline so sharply. The fall in orders of 14% in 2011 is only going to lead to decreasing construction output during the next 18 months."

“It is clear that the government’s cuts are having an adverse impact on the industry with new orders for public falling by one third in 2011. On the positive side, it was good to see a rise in orders for private housing, industrial and infrastructure.

“However, with the largest construction sector, commercial, also registering falls in orders in Q4, the prospects for the industry overall will be extremely challenging. Our latest forecasts for construction anticipate a 5.2% fall in the industry overall in 2012, with public sector construction falling 14%. It is clear that if the Chancellor wants construction to be at the heart of the economic recovery then the Budget will need additional measures to help the sector and economy. Government needs to do its utmost to shift current spending, which continues to rise, into capital spending, which government anticipates will fall 30%. Additionally, the Autumn Statement provided a GBP5bn stimulus for infrastructure but 85% will not be available until 2013/14 and it is essential that this is brought forward to provide the growth now when it is needed to generate activity and employment for the economy as a whole.”