The State employment and training agency FÁS has said it now expects that the number of people employed in the construction sector will have fallen by 50,000 from its peak by the end of next year. It says this will pose serious policy challenges for Government.
This new forecast from FÁS comes after new figures from CSO showed that employment in the construction sector fell by almost 12% in the 12 months to March. This is the largest annual contraction in construction employment since records began in 1994.
Separately, a survey of house builders by stockbroker Merrion has found that more than half are not building at the moment - and half of these do not plan to restart building for at least a year.
Merrion said the results indicated that house builders now see the housing downturn being deeper and more prolonged than they previously had expected. The survey covered 26 building companies.
It found that 73% of builders had noted lower selling prices this year compared with 2007, with almost 40% seeing drops of 10% to 20%.
For 2009, 88% of builders expect their prices to be unchanged from this year, but 8% expect more falls and only 4% see any increase.
77% of builders surveyed had houses for sale, but 30% of these believed it would take more than a year to clear their backlog.
Half of all those who responded said first-time buyers in particular were finding it very difficult to obtain a mortgage, as banks had tightened lending, while some builders pointed to an absence of investors in the property market.
In response, Merrion this morning cut its earnings estimates for housebuilding companies Abbey and McInerney.
Meanwhile, FÁS also said today that it was developing a new action plan with the twin objective of providing assistance to builders who will lose their jobs, and also helping apprentices who are made redundant to complete their apprenticeship.
The construction sectors that FÁS expects to target for replacement jobs for builders include the sustainable development and repair and maintenance sectors, as well as infrastructure projects funded by the National Development Plan.
