Construction Output Predicted To Drop In 2020

The UK’s construction output is expected to drop by 25 per cent this year because of social distancing measures enforced as a result of the pandemic, with 60 per cent of planned construction output lost in April because of the lockdown.

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Research from the Construction Products Association (CPA) suggests that even under the most optimistic of all scenarios for the industry, construction activity would still see the sharpest fall ever registered.

The most optimistic scenario is based on a V-shaped recession that predominantly affects the second half of March and the whole of April and May, with a recovery seen in June – but at a slower pace than the initial decline.

Noble Francis, economics director with the CPA, observed that the near-term effect of coronavirus on the economy and employment is expected to be far greater than was seen during the recession of 2008/2009.

“In addition to these issues around the general economy and construction demand, productivity on site has fallen significantly due to social distancing and other safety, which means that construction activity will take longer and cost more.

“Even in our most optimistic scenario, construction output bounces back by 25.5 per cent in 2021 but, with growth starting from a low base, output will still be six per cent lower than in 2019,” he added.

The majority of construction sites around England and Wales are now open, with figures from trade body Build UK showing that 86 per cent are now back in action.

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