The construction market in Scotland is expected to shrink this year, according to a survey.
Chartered surveyors predict that output will decrease in 2013, continuing a challenging time for the sector.
The latest construction market survey by the Royal Institution of Chartered Surveyors (RICS) found that 24% more surveyors across Scotland reported that they expect their workloads to fall over the next 12 months.
Some surveyors said that the forthcoming referendum on Scottish independence was having an impact on investment and business confidence. The predicted downturn comes on top of a decline in reported workloads in the final three months of 2012, according to the survey for the final quarter of last year.
RICS said the most substantial fall was in public sector non-housing projects, with 26% more surveyors reporting falling, rather than rising, workloads. About 95% of Scottish surveyors believe that financial constraints are holding the industry back, with a further two-thirds citing insufficient demand.
RICS said this comes despite the introduction of the Funding for Lending scheme, an initiative launched in the summer by the Bank of England and the Treasury with a view to boosting lending to households and businesses.
David Taylor, from chartered quantity surveyors CBA, based in Glasgow, told the survey: "There is some sign of greater activity but there is still a general lack of confidence in all sectors. Funding continues to be an issue, with bank funding almost disappearing."
David Cation, from Charles Henshaw and Sons in Edinburgh, told the study that the looming independence referendum in 2014 is "holding back investment from the private sector".
RICS Scotland director Sarah Speirs said: "After a disappointing few months the sector is still struggling with the continued decline of reported workloads. Critically, competitive pressures in the sector remain intense, which is continuing to erode profit margins.
"For the time being, financing constraints are still an issue, however, the Scottish Government announcement in autumn of an additional £394 million being made available for capital building and infrastructure projects in Scotland should aid growth in the sector."
