Construction work won't add to Q4 growth

Economists say sluggish construction work is unlikely to have added to growth in the final quarter of 2016, with public sector construction falling the most.

Construction work failed to bounce back in the December quarter so it's unlikely to have boosted economic growth, economists say,.

The amount of construction work done fell 0.2 per cent in quarter and 7.8 per cent on an annual basis, the Australian Bureau of Statistics data showed on Wednesday.

Commonwealth Bank economist Kate Clifton said construction work had been expected to rebound after slumping 4.9 per cent in the September quarter due to wet weather.

"Construction work will make a flat contribution to fourth quarter GDP (gross domestic product)," she said.

ANZ economists said the fall was driven by weakness in public sector construction work, which slipped 1.6 per cent, and particularly sluggish non-residential building work.

They said that was occurring due to a lack of stimulus-based education and health projects.

The ANZ economists said the first quarterly rise in private work in 18 months was mainly driven by non-residential buildings, however they noted that that sub-sector had merely bounced back after a fall the previous quarter.

They said housing construction also rose 1.1 per cent, but that was almost entirely due to a 7.0 per cent leap in NSW.

Engineering construction work fell 2.2 per cent in the quarter, reflecting the wind-down of the mining construction boom.

"Despite the soft result, the increase in privately-funded activity was an encouraging sign, and suggested that the peak drag from the mining sector has passed," the ANZ economists said.