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Construction product sales expand at fastest rate for three years

In its quarterly Construction Activity Barometer, the CPA/Ernst & Young survey of the construction products industry said growth in the second quarter of 2010 was the fastest it has been for three years.

Sales of construction products rose significantly during the second quarter of 2010 and manufacturers are confident that they will continue to grow once again in the third quarter, the survey said.

The way thr barometer is measured shows that a figure of 50 represents no change in sales compared to a year earlier with below 50 representing a fall in sales.

The second quarter’s overall result of 77 suggests that conditions for product manufacturers are improving.

This has to be treated with some caution however, as sales in the same period last year were very weak, meaning comparative sales figures are low.

Heavy side manufacturers, which include the manufacturers of heavy machinery and aggregates, rose to 79 in the second quarter, the highest level since the second quarter of 2007, while light side manufacturers, which include manufacturers of electrical and lighting products, were also positive with a score of 66.

Construction Products Association’s economics director Noble Francis said: “This latest survey illustrates that the situation for the construction products industry is substantially better than it was one year ago but, with major public spending cuts looming, manufacturers fear that sales will fall sharply once again.”

“With government capital expenditure set to be cut by £100 billion over the next five years there is a real danger that any recovery in the construction industry will be delayed.”