The West Midlands construction sector will shrink at an average rate of 1.1 per cent every year until 2016, according to a new report.

Labour market data produced by CITB-Construction Skills for the construction industry shows the decrease will include a 2.3 per cent fall in new work but an increase of 1.7 per cent in repair and maintenance.

The number of people employed in construction is also expected to drop, reaching 207,900 in 2016 – two per cent lower than its 2012 level.

This fall is compounded by the wait for large-scale construction projects in 2016, such as Birmingham’s Eastside district and the High Speed 2 rail link.

Despite the harsh conditions, 12 of the West Midlands’ 26 occupational categories for construction are set to grow, the biggest being technical staff with a growth of 18 per cent, architects with a growth of 13 per cent and glaziers with a growth of 12 per cent.

Industrial construction is predicted to see 3.8 per cent growth in the next five years, including work on the £350m Jaguar Land Rover engine plant near Wolverhampton.

Easing economic and credit conditions are expected to provide a boost to private housing construction, with growth averaging 3.6 per cent per year until 2016.

Amanda Sergeant, CITB-Construction Skills sector strategy manager for the West Midlands, said: “The forecast for 2012 is a clear indication of the challenges we are still facing in the construction industry in the West Midlands.

"Times are tough and the effects are being felt particularly heavily by tradespeople and labourers.

“The forecasts for growth in skilled sectors such as industrial construction and private housing shows that there is a real need within the industry for a skilled workforce to meet demand in these areas.

“It is imperative that the industry continues to invest in skills and training, particularly for these emerging sectors in the region.

“The construction industry is key to the UK’s economic prosperity, and with this in mind CITB-Construction Skills will be working with construction employers to add value during these tough times, ensuring the delivery of growth locally and nationally.”

The public housing and public non-housing sectors are set to fare the worst in 2012, with continuing annual declines of 17.7 per cent and 21.5 per cent respectively.