Allan Callaghan, managing director of Cruden Building, said cross-party efforts are required to mitigate the continued effects of skills shortage and the ongoing threat of Brexit after output in the UK construction sector contracted for the eighth consecutive three-month period.

The Office for National Statistics (ONS) said that the 0.7% fall in output during the three-months to December is the third consecutive quarter of decline and represents the most sustained fall in quarterly construction output since Quarter 3 (July to Sept) 2012.

Responding to the figures, Mr Callaghan, said: “It’s been a challenging time for the construction industry, and margins are constantly being squeezed. However, in contrast to construction output falling over recent months, housebuilding continues to hold its own and is thriving in Scotland, as reflected in our own strong forecast for 2018.

“Yet, this is no cause for complacency. Recent research by the CITB shows that we need at least 10,000 new workers over the next five years simply to marginal growth. Across the wider construction industry, the skills shortage and ongoing threat of Brexit continues to erode confidence and drive down productivity.

“It’s time to put politics aside and combine private, public and cross-party efforts to address these challenges in a collaborative and creative way. At Cruden we’re doing our part by proactively investing in future talent, but more needs to be done at an industry-wide level to plug the widening skills gap.”

Despite falling in both the three-month on three-month and quarter-on-quarter time series, construction output grew in the month-on-month series, increasing by 1.6% in December 2017.

The estimate for construction growth in Quarter 4 2017 has been revised up 0.3 percentage points to negative 0.7% from negative 1% in the preliminary estimate of gross domestic product (GDP), which has no impact on quarterly GDP growth to one decimal place.

Despite experiencing three consecutive quarterly declines, construction output in Great Britain grew by 5.1% in 2017 due to strong growth at the end of 2016 and in Quarter 1 (Jan to Mar) 2017.