Builders were snowed under in January as the sector’s recent revival threatens to be shortlived, official figures showed today.
The construction industry managed growth of 0.9 per cent in the final three months of 2012, breaking a year-long run of decline. But January’s figures — likely to have been impacted by heavy snow across much of the UK — revealed a 6.3 per cent slide in output, putting the industry in danger of a plunge back into the red.
Construction accounts for just under 7 per cent of overall UK output, but it is particularly vulnerable to a stuttering economy and is still nearly 17 per cent below its pre-recession peak. Experts warned that the latest decline — driven by a 7.9 per cent fall in new work during January — shortened the odds of an unprecedented triple-dip recession after the wider economy shrank 0.3 per cent at the end of last year.
More timely industry surveys have also pointed to continued weakness in February, after the Chartered Institute of Purchasing & Supply said the industry shrank at its fastest pace for three years last month.
Scotia Bank’s Alan Clarke said a triple dip was “increasingly likely”. He added: “Compared with Q4, the sector will subtract half a percentage point from quarter-on-quarter growth and other sectors are unlikely to take up the slack.”
Read more on this topic: Budget 2013: cut VAT on building repairs to boost the economyReuse content