By Marcus Leach

Data released by the Office for National Statistics (ONS) today (Friday) has shown that the UK's trade deficit widened sharply in April to its highest level in almost seven years.

This increase is largely due to a slump in car and chemical exports. ONS data showed the seasonally adjusted deficit was £4.4bn, compared with £3bn in March.

Other highlights:

- The deficit on seasonally adjusted trade in goods was £10.1 billion in April, compared with a deficit of £8.7 billion in March.
- The surplus on seasonally adjusted trade in services was estimated at £5.7 billion in April, compared with a surplus of £5.8 billion in March.
- Excluding oil and erratic items, the seasonally adjusted volume of exports was 7.1 per cent lower, and the volume of imports was 3.0 per cent lower in April compared with March.

"After last week's PMI survey showed that sector confidence is the lowest it has been for six months, these latest numbers make pretty painful reading," Steve McGuckin, managing director of the construction and programme management consultancy Turner & Townsend, commented.

"They suggest that the construction industry's challenges aren't as bad as we thought. They're worse.

"With public sector construction down more than 22% on this time last year, the impact of the government's austerity cuts is clear.

"There have been some signs of life in the private sector, but their impact has been to do little more than mitigate the pain.

"The hope persists that the private sector will ride to the rescue of a sector that's been hit particularly hard by the decline in public spending. But these figures clearly show that it hasn't happened yet.

"The pain isn't being spread equally over the regions either - with South East England proving more resilient than almost everywhere else.

"Demand is still there, but competition for work is very intense. The major players are surviving, even if their margins have got steadily tighter.

"Niche players who excel at what they do are also bearing up well, but it's the middle ground - non-specialists whose services are commoditised - who are most at risk."

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