Redundancies would hit 17 per cent of the SME work force before Christmas, according to a Ceca survey of SME firms in October.
CECA director Rosemary Beales said: "There is little sign that the overall market for civil engineering contractors is improving as we head into 2009, and our research shows that for SMEs especially, the situation is getting steadily worse.
"If the SME sector is allowed to contract, through redundancies and businesses failing, then the construction industry will lose capacity and the skills and resources lost will have to be replaced - at great expense - when demand for infrastructure development returns.”
CECA is set to speak to various MPs about its ten point action plan for SMEs:
*Accelerate expenditure on planned public sector infrastructure works
*Ensure prompt payment of amounts due to small and medium sized firms
*Demand fair treatment of small and medium-sized contractors by banks
*Encourage the use of local firms on work under EU procurement regulation threshold
*Reinstate rate relief on empty commercial property
*Prevent the use of on-demand bonds and remove retentions from future contracts
*Cut planning, environmental and heritage consent bureaucracy
*Take steps to reinvigorate the housing market
*Streamline procurement of construction work, selecting on quality, rather than solely on price
*Protect the next generation of skills