Construction industry takes case for investment to The Treasury

The Northern Echo: INDUSTRY PLAN: George Ozborne INDUSTRY PLAN: George Ozborne

A DELEGATION from the construction industry is set to present a ten-point plan to Chancellor George Osbourne tomorrow as a report predicts by 2016 employment in the industry will fall to its lowest level in 16 years.

Representatives from heavy-weight construction firms including Balfour Beatty and Carillion will join delegates from industry groups the Civil Engineering Contractors Association (CECA) and the Confederation of British Industry (CBI) to meet ministers at the 11 Downing Street summit.

The Construction4Growth campaign, which is backed by more than 1,400 construction bodies and employers, will call on the Government to actively support the industry following figures which show employment in the industry is forecast to fall every year until at least 2016, reaching a low of 2.36m.

The report, by the Construction Skills Network (CSN), shows the extent of the impact on the sector during one of the industry’s most difficult periods since the Second World War - and predicts difficult conditions will continue for at least the next decade.

It reveals the North-East was among the worst-performing regions in construction last year, with a 9 per cent fall in output - but also that the sector in this region has the brightest outlook of almost any in the UK.

The report, prepared by CITB-ConstructionSkills based on evidence from construction businesses, shows the outlook for the North-East is more positive than in almost any other UK region, with figures suggesting an annual growth of 1.7 per cent until 2017 – significantly higher than the national average of 0.8 per cent.

However, the report, which is regarded as the industry’s annual skills forecast, points out this growth will occur in a region where the construction industry has been hit hard by recession in previous years.

Commercial construction is set to see the greatest average growth at 8.9 per cent a year for the next five years, according to the report, while public sector construction, excluding housing, is predicted to have an annual decline of 9 per cent.

The infrastructure sector is also forecast to see an annual rise of 3.8 per cent over the same period, boosted by the A1 upgrade plans outlined in the Autumn Statement.

Steve Housden, sector strategy manager for CITB-ConstructionSkills for the North-East, said: “Construction found itself at the heart of a ‘perfect storm’ in 2012 – hit hard by a combination of public sector spending cuts and a lack of investment in the private sector. Client and consumer confidence is low and it is keeping growth levels down.

“The North-East, although predicted to grow by 1.7 per cent - this bucking the national trend - is still set to see employment figures drop in a four year period up to 2017.

“With this in mind, we are doing all we can to work with construction employers to add value during these tough times, as this will hopefully lead to further growth on a local and national level.

“Construction is a vital engine of UK growth. While construction struggles for its survival, it’s impossible to see how the UK economy can generate significant growth.”

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