Confidence has fallen sharply in the construction industry, according to a report by Grant Thornton UK and the Institute of Chartered Accountants in England and Wales.
The Business Confidence Monitor found the Confidence Index for construction sector businesses dropped from +6.3 in Q4 2010 to -16.5 in Q1 2011.
Confidence in the sector is now at its lowest point since spring 2009.
As the public sector cuts hit home, more than six in 10 firms said customer demand was a greater challenge than 12 months ago.
Phil Westerman, construction partner at Grant Thornton, said: “Estimates from the Office for National Statistics showed the economy contracting by 0.6 per cent in Q4 2010.
“Coupled with restricted credit conditions, a dampened housing market and adverse weather conditions at the end of last year, confidence in the construction sector has taken a hit.”