7.5% fall in European construction output expected

Construction output across the major European countries is expected to fall by 7.5% this year, according to the latest forecasts from market analyst Experian.

The figures, which cover the 19 member countries of business research network Euroconstruct, follow a 3% decline in 2008. The data suggests there will be a smaller fall of 1% in 2010, before the industry returns to growth in 2011.

Activity in the UK and Italy is expected to drop by 7.5%, while Finland, Ireland, Portugal and Spain are predicted to see double digit contraction, as weak housing markets take their toll. Germany is expected to see a 3.5% fall.

Only Switzerland and Poland are forecast to see any increase in activity this year, driven by civil engineering work and a stable level of activity in the residential sector.

James Hastings, head of construction futures at Experian, the UK representative of Euroconstruct, commented: “While countries such as Germany were not nearly so exposed to ‘toxic’ debt as the UK, their export-led growth has been badly hit by the decline in world trade, with a consequent knock-on effect on construction activity.”