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Czech Republic – Construction industry continues its sharp decline

21. December, 2011

The effects of the economic downturn, including reduced government and private sector spending and less bank lending, will keep the construction sector in decline and likely lead to the closing of more firms and the pull-out of foreign companies.

By the end of 2011, the total construction volume is expected to be 20 percent lower than in 2008.

The funding of transport infrastructure as well as for maintenance has declined significantly and was cut by around 660 mil. Euro in 2011. For 2012, the Transport Ministry budget for infrastructure is expected to be around 1.6 bil. Euro, compared with the infrastructure budget approved for 2010 that was above 3.5 bil Euro.

As a result of the decline, the average registered number of employees in enterprises with more than 50 workers fell by 8.5 percent on the year in October.  Industry associations and labor unions have said they expect construction to be the hardest hit by staff cuts next year