The latest figures show the value of construction to the Scottish economy having fallen by 2% in the last quarter of last year. However, the statistics suggest this has been more than offset by the rises in output recorded in the preceding three quarters of 2010.
Trade body the Scottish Building Federation (SBF) claims that the new figures bear little relation to the “real world” currently being faced by the industry. It has pointed to separate official statistics published this week, showing an 11% increase in firms becoming insolvent or entering receivership in the final three months of 2010. The SBF believes that this increase may partly be explained by a rise in construction firms getting into difficulties.
SBF chief executive Michael Levack said: “I find it very hard to reconcile these latest GDP figures with the reality many construction firms are facing on the ground. Private sector construction still has a mountain to climb to get back to anywhere near the rates of output it was showing two years ago – and with budgets being slashed, public contracts are drying up fast.
“The drop in value of the construction sector in the final quarter of last year shown by these figures is a better reflection of the real world. Added to which, latest unemployment figures show 6,000 Scottish construction workers lost their jobs during that same period.
“What is more, we have seen the number of firms becoming bankrupt rise by 11% at the close of 2010. If we examine the detail of these figures, I suspect they will show the construction industry contributing substantially to that rising trend.
Mr Levack concluded: “Politicians campaigning in advance of next month’s Scottish election please take note: Scotland’s construction industry continues to need your understanding and support – and a clear plan of action to set the sector and the Scottish economy as a whole on the path to sustainable recovery.”
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