Paralleling trends in the U.S. construction market, housing starts in Great Britain this year are forecast to be the lowest since 1945, according to the latest Construction Output Forecasts from the Construction Products Association, a London-based group representing the U.K.'s manufacturers and suppliers of construction products, components, and fittings. The forecasts point to little more than 147,000 new housing starts this year, a fall of 27% from the levels in 2007 — the smallest number since 1945. Private sector housing starts are expected to be down by 30% to the lowest level since 1992, while the social housing program is failing to grow in line with the government's plans for 45,000 new homes a year by 2011.

“The impact on the new build housing market has been more severe than any of us anticipated,” says Michael Ankers, chief executive of the Construction Products Association. “To be starting fewer new homes than at any time over the last 60 years illustrates the scale of the problem we now face. Unless something is done urgently to address this problem, the capacity in the industry will be cut to a level that will take a long time to build up and it will not be able to meet the inevitable pent up demand for new housing.”

On a broader scope, long-awaited government programs for education and infrastructure are expected to help reduce the impact of the housing downturn on the construction industry. Nevertheless, 2008 seems likely to see the sharpest fall in construction output since 1993, reports the Association, with the situation deteriorating further still in 2009 before a modest recovery in the following year.

A copy of the forecasts in their entirety is available from the Construction Products Association