Construction is heading for a very nasty tumble next year after the current spurt in workload fades.

That at least is the assessment of the first major industry forecast released since the Chancellor鈥檚 spending review announcements.

The construction forecast by suggests that after an unexpected 5.6% rise in construction over this year as a whole, the industry will slide sharply by 5.8% next year and 4.8% in 2012.

It is worth noting that the forecast by Hewes does tend to shade on the pessimistic side. But in its favour it was the first to highlight the potential scale of the decline in output that followed in the wake of the financial crisis.

So, while we might expect that subsequent forecasts by other organisations will probably be less downbeat, this forecast does present cause for concern. And what鈥檚 more it seems to capture the increasing mood of pessimism within the industry that suggests construction is in for a double-dip.

Underpinning the latest forecast is the view that Hewes has maintained for some while, that the financial crisis and subsequent recession and their causes will cast a long shadow over the economy and restrain growth.

The decline in forecast construction activity is expected to come from a fairly pallid response by the private sector to fill huge gaps left by the withdrawal of public funding, which has supported not only public sector activity but also a significant amount of private sector work.

The result, if the Hewes forecast comes to pass, will be an industry running at a level more than 5% below the depths of the recent slump, with all sectors bar private housing still in decline in 2012.

In many ways, with so much confusion over the official construction output figures, the job of forecasting has been made much trickier. The strength of the rebound in construction portrayed in recent official data for construction output has surprised most forecasts and, indeed, the industry at large.

But that confusion aside, there is little doubt there has been a strong bounce back fuelled by the fiscal stimulus and the bringing forward of capital spending. This, however, is expected to provide a fairly short-lived reprieve for the industry.

Trade data, even the fairly upbeat , point to a weakening in the growth rate.

And with continuing to run as they have for about two years at levels about 25% below peak, it is hard to see how output at the levels currently being recorded can be sustained.

The questions really are: How much of a slowdown will the industry suffer during the latter month of this year and the early months of next year? And how long will it take for the private sector to respond and stimulate growth in construction?

Not until we see the effects of a fall away in public funding will we really start to gain a clear picture of the landscape ahead for construction.

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