The amount of construction work being commissioned from small building companies has continued to decline for the tenth consecutive quarter, according to the latest State of Trade Survey from the Federation of Master Builders (FMB).

However, there are signs that the continual fall in workloads maybe nearing its end with a leveling off in the rate of decline for both residential and non residential work.

Brian Berry, Director of External Affairs at the FMB said: "Despite the fact that the Quarter Two results from our survey still show two and a half years of declining workloads, underneath the headline results we are seeing grounds for some optimism in that workloads and employment are at least beginning to stabilize around their current albeit much reduced levels."

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According to the FMB workloads across the entire housing sector are showing encouraging signs of stabilisation by the fact that 46% of FMB companies are undertaking private new housing, 62% of FMB companies are undertaking social new housing and 52% of FMB companies carrying out social repair.

Mr Berry concluded: "The recovery in the wider construction sector is still very fragile, and the signs of stabilisation in the SME sector are not the same as actual growth. Even without further decline we have some very serious problems.

"Looking ahead we have yet to see the details of the Government's autumn spending review and the impact of the increase in the rate of VAT to 20% next year might jeopardize the recovery, resulting in thousands of jobs losses and push the building industry back into recession."

(CD)