The construction industry has a long way to go before a sustained recovery sets in, warns the Federation of Master Builders (FMB) in response to its latest survey of members for the last three months of 2009.

Figures from the FMB's State of Trade Survey, the only survey of SMEs in the construction industry, for the last three months of 2009 reveal that 44% of FMB firms expect their workloads to decline in the first three months of 2010.

Only 18% of FMB firms expect their workloads to increase in the final quarter of 2009 also revealed a major decline in workloads and employment for FMB firms and, based on this outlook, 2010 looks sets to begin with a ninth consecutive quarter of deterioration.

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Richard Diment, Director-General of the FMB said: "The employment figures from our members' survey are particularly alarming as, even after seven consecutive quarters of layoffs, 38% of FMB firms reported that they had cut staffing levels. Even more alarming is the fact that 33% of FMB firms expect to have to make staff cuts in the first three months of this year."

Mr Diment warned: "Despite the urgent need to cut the public expenditure deficit, investment in the construction sector offers the best hope of propelling this country back into recovery because every £1 spent on construction output generates a total of £2.84 in total economic activity. Any cuts in construction would merely cripple an already badly damaged skills base and supply chain and seriously inhibit the building industry's recovery."

(CD/GK)