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Construction output will hit 2007 levels 'in 2021'

The Construction Products Association is forecasting it will take until 2021 for the construction industry to return to the output levels of 2007.

In its Q3 forecasts the Association is predicting a fall in construction output of 15 per cent this year and 2 per cent in 2010 before a slight recovery in 2011.

This latest forecast points out that even with trend growth in the industry in the years after 2011, it would take until 2021 for construction output to reach the levels of 2007.

Chief executive Michael Ankers said: “There are signs that the private housing market is beginning to pick up although the recovery is expected to be slow and from historically very low levels.

“However, even with this new optimism the total number of houses expected to be built in the two years 2009 and 2010 will only equal the number built in the year before the credit crunch.

“Government spending on construction projects in the short term remains strong and without this the industry would be in a far worse position.

“We remain very concerned that any significant cut-backs in capital spending after the election will prolong the downturn as it will be some time before we expect to see significant growth in private sector commercial projects.

“One bright spot for the industry is government spending on infrastructure, which we see remaining strong throughout our five year forecast period, with commitments to the rail network, a new five year programme for investment in water and, towards the end of the period in particular, the start of major investments in new energy supply.

“Following the publication of these forecasts the Association will continue its dialogue with the main political parties to ensure they recognise the construction industry is key to sustaining employment and bringing the economy out of recession.”