100,000 jobs face axe in construction over next year

UP to 100,000 jobs may be lost in construction over the next 12 months, pushing the total number of job losses in the sector to 300,000 in three years.

The warning came from the Construction Industry Federation, which called on the Government to boost the spend on infrastructure to prevent further job losses.

CIF director general Tom Parlon said he feared the Department of Finance was cutting back sharply on infrastructure spend.

If the €6.5 billion spend on capital projects is activated this year, then 100,000 more construction jobs will vanish from the sector in the next 12 months, he warned.

Fewer than 20,000 houses will be built this year and just 12,0000 in 2010, forecasters project. A total of 93,000 dwellings were built in the peak of 2006.

The scarcity of new projects coming on stream was a major worry, said Mr Parlon.

With no projects being prepared or started, “there was nothing in the pipeline to sustain the sector in years to come”, he said.

New investment in 2009 would be between €500m and €1bn which was totally inadequate to sustain the level of jobs in the sector, he said.

Austin Hughes, economist at KCB Bank, said the 100,000 job losses projected was probably a “worst-case scenario”.

Jobs will continue to be lost over the next 12 to 18 as the economy adjusts to the crisis. He warned blanket 1980s-style cutbacks would prolong the current downturn longer than necessary.

“We need to be a little more subtle in the way we implement policy,” he said.

In a statement Fine Gael leader Enda Kenny said the Government planned €13bn cuts in infrastructure through to 2010.

That was a serious mistake, he said. Fine Gael said the Government should spend €11bn over the next four years, creating 100,0000 jobs in the process.

“I have said many times in the past that we need to stimulate the economy, create new jobs and protect as many current jobs as possible,” he said.

“That is why I repeat my invitation to the Taoiseach to implement Fine Gael’s plan,” he said.

Mr Parlon said theNational Roads Authority has cut back dramatically on the number of new roads being built, declining to 5.5km this year from 216km in 2006, with no investment planned for next year.

The CIF chief said there was a huge need for investment in new and refurbished schools, waste facilities, Garda stations and other services.

The CIF has proposed an investment programme based on an infrastructure bond for Irish private pension funds as a means of funding new projects.

Welcoming the setting up of NAMA, Mr Parlon called for its speedy implementation, noting that individual members were having difficulty dealing with banks at present.

For that reason it was important the bank was commissioned without undue delay, he said.