Britain's embattled construction sector is expected to flatline next year after its outlook was downgraded again by forecasters.
Economists at trade body the Construction Products Association (CPA) now believe the industry’s output will not grow at all next year, a downward revision from its previous estimate of 0.7pc growth.
As recently as spring this year the CPA predicted 1.2pc expansion for 2018. Construction firms will find it “difficult to escape” a toxic mix of subdued economic growth, rising inflation and falling real wages over the next two years, the CPA warned.
Worse prospects for office construction contributed to the downgrade. This is expected to lead to a 15pc fall in activity for the sub-sector next year.
The CPA said the industry was increasingly reliant on major infrastructure projects such as HS2 to fill order books. It warned if the Government’s pipeline of projects does not come to fruition, “an industry-wide decline of over 1pc in 2018” could occur.
As it stands, infrastructure work is expected to grow 6.4pc next year, while private housing starts are expected to grow 2pc, although both represent a slowdown on this year.
The CPA expects overall construction output to end 2017 up 0.7pc.
Meanwhile, a separate survey of chief financial officers by consultant Deloitte found renewed optimism across the economy as a whole.
The survey of more than 100 finance chiefs at FTSE 350 firms and other large private companies found that optimism had recovered to levels last seen at the end of last year. More than a quarter (27pc) say they are more positive about prospects for their company, up from 18pc three months ago, while 27pc say they are less optimistic, down from 42pc.
Source: The Telegraph
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