The construction industry is always vulnerable in a recession. So many potential customers are going to be deterred from starting new projects. Overall, the industry contributes around 6% of total UK GDP, but output is very volatile as the industry has to cope with larger fluctuations in demand than most businesses. There are three main reasons:
1 Businesses that face falling demand for their products will be less likely to expand. There will be fewer investments in factorybuilding projects, e.g. fewer chain stores will be looking for retail outlets so fewer shopping centre developments will be planned and fewer office buildings will be needed.
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