Construction orders still falling, says trade survey

New orders are continuing to fall across most sectors of construction, according to a bleak trade survey published by the Construction Products Association today.

The survey, covering the third quarter of 2009, found that enquiries and orders among civil engineering contractors, building contractors and specialist contractors are continuing to fall, along with sales of construction products.

The construction industry is now facing its sharpest fall on record this year with a further decline in output expected in 2010, added the report.

"With sharp falls currently in private sector construction and the potential for sharp spending cuts post-election in public sector construction, this is a critical time for the industry, which is not expected to see any growth until 2011 at the earliest," said Noble Francis, economics director at the Construction Products Association.

Key survey findings were:

• 86% of heavy side manufacturers and 75% of light side manufacturers reported that sales, on balance, fell significantly in the third quarter of 2009
• 60% of building contractors reported that output fell in the industrial sector and 50% reported that output fell in the commercial sector during the last three months
• 63% of building contractors reported that their order books fell in the industrial sector and 76% reported that their order books have fallen in the commercial sector
• 62% of heavy side and 75% of light side manufacturers stated that unit costs had risen due to rises in raw materials prices and fuel/energy costs despite falls in labour costs
• 75% of building contractors reported that tender prices and profit margins fell over the last quarter and 74% of civils contractors reported that, on balance, tender prices fell during the same period