Despite stories of economic struggles scattered around Europe, there is some bright news from the United Kingdom. According to financial data, the United Kingdom maintained its 16-month recovery in the construction sector. Strong orders for new building projects and a rise in employment in April have helped sustain construction recovery as well as economic growth. The main demand for this boost of construction output has come from commercial building and civil engineering during the spring months and is expected to be carried forward into the summer. Another major cause of this growth is probably not a surprise to anyone—the 2012 Summer Olympics.

With the 2012 Summer Olympics taking place in London, much preparation has been underway in terms of construction and infrastructure development. Millions of tourists from around the world and athletes from almost every country will be participating in the Olympics. For this reason, much construction activity is taking place in London and in the south-east of the United Kingdom where the Olympics are taking place. The construction projects for the Olympics accounts for a major portion of the United Kingdom construction sector recovery. This simple fact shows the significant economic benefits a major global event could have on a country’s economy.

Despite this good news of recovery in the construction sector, some economists are divided and are less optimistic about the outlook of the United Kingdom recovery. They argue that really the only reason construction has recovered significantly is because of reliance on construction projects preparing for the Olympics. Therefore, these recovery effects may be only temporary as the 2012 Summer Olympics are set to begin July 27th and will end a few weeks after. It will be interesting to see if recovery in the United Kingdom continues after the Olympics. Do you think economic growth and construction sector recovery will remain after the Olympics or is the current state of recovery just temporary due to the Olympic preparation?

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