THE AWARD of multi-million pound house building contracts will not be enough to prevent thousands of job losses in the North-East construction industry this year.

Housing body North East Procurement, based in Newcastle, yesterday revealed the names of the 12 firms that will share £480m-worth of work over the next four years.

However, the announcement came as a doom-laden report predicted that a further 45,000 jobs will be lost in the UK construction industry this year as economic uncertainty continues, signalling what has been termed "a lost decade" for the sector.

The winning bidders based in this region for the house building contracts were: Dunelm Property Services of Durham, Sunderland headquartered Gentoo Group, Galliford Try Partnerships of Newcastle and Gateshead firms Keepmoat and Mansell Construction Services.

The new builds will take place predominantly across the North-East, North Yorkshire and the City of York.

The announcement offered a shot in the arm for the house building industry which has shown some signs of recovery after suffering a torrid period over the last two years. Housebuilders Persimmon and Barratt were among the regions firms to sound an upbeat note this month.

But the picture across the wider building industry was gloomy and a decline in output will particularly hit the North-East, a report from the CITB-ConstructionSkills (the Industry Training Board and Sector Skills Council) said.

Construction employment in the region is predicted to fall by 3 per cent in 2012 as decreasing levels of demand and tough trading conditions mean the industry will need fewer skilled staff.

The reduced demand for workers will not only impact on traditional trades, such as wood workers, roofers, painters and decorators and labourers, but will extend to civil engineers and senior managers.

With a 6 per cent decline in forecast output for 2012, double the national average, the North-East is set for a challenging year, with growth expected to be slow and uneven.

The road to recovery may be longer than first anticipated as the economy continues to be plagued by uncertainty, with conditions not set to improve much before 2013 at the earliest when output is expected to bounce back by 3 per cent, the report said.

However, despite short term challenging conditions, the number of people employed in the industry in the North East will reach 102,470 by 2016, which is 8 per cent higher than 2012 forecasted levels, and the region will account for 5 per cent of the total UK annual recruitment requirements.

Steve Housden, sector strategy manager for CITB-ConstructionSkills in the North East, said: "Times are tough, and the effects are being particularly heavily felt by tradespeople and labourers. While the forecast for 2016 gives reason for optimism, there is a real danger that the industry will not have the skills it needs to complete major projects in the longer term. With this in mind, its imperative that the industry continues to invest in skills and training."

North East Procurement, which is a not for profit procurement body representing 13 housing association, offered some cheer by confirming it will shortly invite bids for a housing refurbishment contracts.

A meet the buyer event will be held in the middle of February to set out the programme, which has been estimated to be worth up to £240m over four years.

Firms can register an interest in the framework, which is due to come into force in June, at nepplannedworks@valueworks.co.uk