Construction accounts for 23 per cent of Ireland's GNP and employs 416,000 people but is showing signs of a real downturn, according to the latest Construction Industry Review 2006 and Outlook 2007-2009 from DKM Economic Consultants. The annual report looks at construction activity and prospects, on behalf of the Department of the Environment, Heritage and Local Government.
It shows that, after 13 years of continuous growth, Irish construction activity peaked in 2006 and it is expected to contract modestly by 1.5 per cent in 2007.
Construction output will fall further in 2008 before returning to positive growth in 2009 but not before some 30,000 jobs are lost in the sector.
The estimate for Irish construction output this year represents 22.6 per cent of GNP and 19 per cent of GDP, when measured in gross output terms.
The construction to GDP ratio is the second highest proportion (after Spain) and ranges from less than 8 per cent in Sweden to over 21 per cent in Spain and with an average ratio of around 12 per cent in Western Europe and less than 11 per cent in the UK.
The value of construction output in 2006 was E35.5 billion which represents almost 24 per cent of total GNP.
The report shows that almost 19 per cent of the national labour force of 2.21 million is employed in the industry.
Housing output peaked at 88,219 units in 2006 but is expected to reduce to 77,000 units in 2007 and 60,000 units in 2008.
Public Sector investment in new buildings and infrastructure increased by 2.7 per cent in 2006 and the current level of investment here will be maintained in coming years under the Government's programme of capital investment under the National Development Plan 2007-2013.