Further fall in construction activity this year, but some signs of recovery, according to Experian’s Construction Forecast

London, 24 June 2010 Construction output is predicted to decline again this year, although by nothing like the fall recorded in 2009, according to the latest Construction Forecast report from Experian.  The global information services company’s report also highlights that there are signs of a recovery in the private markets and, in particular, housing.

James Hastings, Head of Construction Futures at Experian, says: “What may happen this year is an end to the decline in private house building activity, with real growth on the cards for 2011. Despite the depth of public expenditure cuts announced in Tuesday’s budget, public non-residential output is likely to see one more year of growth this year.”

“While the decision to put all Building Schools for the Future projects that have not reached preferred bidder stage on hold, it is unlikely to affect the levels of activity on site this year as the majority of projects in Waves 1 to 3 of the programme have already passed this stage.”

In terms of the infrastructure sector, while there are a number of big transport projects on site or about to start, Experian’s report suggests that in the medium-term the focus in this sector is likely to shift from transport to energy projects.  These include new nuclear build, biomass power stations, and wind farms. Experian’s forecast also assumes that Crossrail goes ahead largely as planned.

Experian’s Construction Forecast report also points to a rebalancing of the public/private split in construction over the next few years.

Over the decade to 2007 the biggest growth in output in percentage terms was in public or publicly driven construction sectors (PFI/PPP). Public housing output during that period grew by 295 per cent and by 173 per cent for private housing. The most buoyant private sector activity was offices, with a 151 per cent increase, but this pales into insignificance against the 867 per cent rise in PFI education activity. This year excepted, Experian’s economists’ prognosis is for a declining level of public expenditure on construction. The major private sectors – housing, industrial and commercial – will need to increase their output to ensure that the industry as a whole does not suffer a prolonged period of stagnation.

For further information visit http://economics.experian.co.uk/ .

ENDS

Contact:

Stephanie Dobson

Experian Public Relations

0115 99 22515

stephanie.dobson@uk.experian.com

About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2010 was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil. 

For more information, visit
http://www.experianplc.com .

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