The economic recovery that the UK has recently been experiencing may not be as solid as it appears on the surface. Indeed it may all still be held afloat by government spending despite what politicians may say.
A report in the Guardian by Phillip Inman points the finger squarely at government sponsored civil engineering projects.
The recent reported GDP growth of is underpinned by construction alone, for example nearly half (4%) of the second quarter's 9.5% growth was down to construction.
The first quarter figures were also dampened by the 'big freeze' in Jan/Feb, which led to a boost in the second and third quarter construction figures. Builders may also have been pushing hard during the lengthy spring and summer months to take full advantage of the good weather and available work (via government funding) while they could.
With this work not going into residential property construction there is little fear of another house price bubble forming. The fear is that when you take construction out of the equation there is very little on which to base the recovery. And with construction now slowing the fourth quarter may see a decline in GDP.
But it is not what has been or is being done that is really important, it is what is in the pipeline that counts for our future growth. As one of the commenters in the report pointed out, even while it looked like work was on the rise by 6-8% between April and June actual orders dropped by 14%. It is also pointed out that in al of this Wales fares the worst in the UK with 84% of civil engineers reporting a drop in workload.
So if government civil engineering is propping up out economy so fundamentally what is going to happen as the austerity cuts begin in earnest and the purse strings are pulled?