THIS paper examines the determinants of new orders for non-residential construction work received from the private industrial sector. The research was financed by the Department of the Environment and forms part of a continuing programme of econometric modelling initiated by the DOE, undertaken to gain an understanding of the causal relationships among economic factors influencing the construction industry. Particular interest in this industry springs from the fact that it is one of the largest and most important sectors of the UK economy. In I976 its output amounted to some 7% of gross domestic product and it employed I.3 million employees- about one-sixth of the total for the whole manufacturing sector. Clearly, because of its size, fluctuations in the activity of the construction industry have significant implications for the whole economy.