The comments from the trade body come after official statistics revealed yesterday that the number of Scotland's unemployed now stands at 197,000.
SBF Executive Director Michael Levack added that in the final three months of 2012 alone, 9,000 Scottish building jobs were lost as construction slumped to a ten-year low.
The figures released on Wednesday coincide with the release of official GDP statistics for Scotland for the final three months of 2012 which shows construction industry output increased by 0.6% during that period.
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Despite the growth, however, the annual industry output remains at its lowest level since 2002.
Commenting on the figures, Mr Levack said: "The latest GDP figures for Scotland show a modest rise in construction output during the last three months of last year. But annual output from the industry remains at its lowest level for ten years. What is more, these latest labour market figures show almost 9,000 jobs were lost from the industry during the final quarter of 2012, taking direct employment in the industry to less than 170,000 for the first time since December 2010.
"As the construction sector continues to shed jobs and capacity, we’re seeing further fragmentation of the industry that is potentially damaging to quality, safety and skills. Reputable firms are under increasing pressure from late payment of bills and a growing number of rouge traders that undercut them and, through substandard work, give the industry a bad name.
"These are some of the critical issues now affecting our industry that require direct government action."
(JP/CD)
