Construction work done across Australia fell further than expected during the December quarter, adding further pessimism to the nation's economic outlook.

Wednesday's seasonally adjusted data from the Australian Bureau of Statistics showed a 3.1 per cent decline in total construction completions - missing consensus predictions of a 0.5 per cent increase - with the engineering and residential sectors a particular drag.

Building work on homes dropped 3.6 per cent on the previous three months, with the decline concentrated on the east coast, where activity has slumped amid a wider market downturn.

The biggest quarterly fall came from a 5.0 per cent decline in engineering work, which St George Bank analyst Jo Horton blamed on a "concerning" decline in public infrastructure completions.

"Today's data along with weak consumer spending suggests GDP growth for the December quarter is going to be weak," Horton said.

Work on non-residential buildings grew by 1.9 per cent for the quarter, rebounding from a 2.3 per cent decline in the September quarter.

Total construction work was down by 2.6 per cent from the same time last year.
ANZ analysts said construction work has been a key support to growth and employment in Australia in recent years and an earlier-than-expected downturn in the sector would be of concern for our outlook.

December GDP data will be released on Wednesday, 6 March.