Construction output to halve costing 90,000 jobs

THE Construction Industry Federation (CIF) has predicted construction output will fall to just half of its 2007 peak next year, with employment over the period dropping by up to 90,000.

The CIF’s annual conference was yesterday told that at its peak last year, the value of construction was €37bn.

“This year that is going to fall back to €30bn, and if the trend continues it could be in the region of €18-€20bn, essentially a halving of the industry,” said Martin Whelan of the CIF.

“With that obviously comes significant job losses. Based on the current trends, we would expect employment to stand at 190,000 by 2009, which would be down 90,000 on the peak at the end of quarter three in 2007.”

For a long time the CIF has said that with the significant drop in house building and other aspects of the construction sector, public infrastructure projects would have to come to the fore.

However, according to Mr Whelan that is just not happening.

“When you put the public capital programme, the infrastructural investment by the State in perspective, while the budget announced quite a significant public capital programme of €8.6bn next year, the reality is that is a €2bn cut on what was planned and over the period 2009-2013 there is a €6.2bn cut,” he said.

“In addition, the State has envisaged that public-private partnership funding will comprise a greater proportion of overall capital expenditure and, in the past, that has not proven to be the case and particularly in the current financial environment it is unlikely that access to funding will be made available to infrastructure and construction projects.

“In light of all that there is a significant stalling of public sector contracts. We know what is happening in housing, we know what is happening on the commercial side. The unknown element is the public side and if the stalling of the projects as we have seen is continued it is going to lead to a further dissipation within the industry. In terms of infrastructural development, in terms of keeping people in employment and in terms of the huge returns for the State from infrastructural development the State has to deliver on its own promise.

“In the run-up to the budget there was a very vocal commitment from the Government that it would not go back to the 1980s policy of cutting infrastructure to fund expenditure.”