Construction to decline next year
16:59 10 Nov 2005
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The construction industry is forecast to go into decline next year.
BDO Stoy Hayward's latest Industry Watch predicts growth of just 2.8% in 2006 and 2.3% in 2007. This year growth continued from 3.7% in 2004 to 6%.
According to BDO's analysis housebuilding has been affected by the "sharp deceleration in house price inflation", while government projects face restraint as the Chancellor tries to cut public borrowing.
The rate of business failures in 2006 and 2007 is also expected to rise on the back of the slowdown in the UK housing market and reduced public spending on infrastructure, according to the forecast. In 2006, the number of failures is expected to pick up again to just above the 2004 level at 2,362 before rising another 2.3% in 2007.