LONDON (dpa-AFX) - The UK construction sector shrank at the slowest pace in eight months in September with slower rates of contraction seen in the residential, commercial and civil engineering segments, survey data from S&P Global showed Tuesday.
The construction Purchasing Managers' Index rose to 46.1 in September from 44.3 in August. However, a score below 50.0 indicates contraction.
All three segments of construction showed slower rates of decline. Commercial construction showed the greatest resilience, while housing activity remained the worst-performing area.
The survey showed that geopolitical tensions and elevated borrowing costs weighed on output. New work contracted the most since June. Firms cited delayed decision-making on major projects and rising input costs as reasons for the decline in new work.
Companies reduced staffing due to reduced workloads. Employment has been reduced in each month since January 2025. There was also a renewed fall in subcontractor usage.
Demand for construction products fell at a marked pace in September. However, suppliers' delivery times lengthened for the second straight month.
Average cost burdens increased sharply in September, but the rate of inflation moderated to a seven-month low.
Looking ahead, construction companies were still optimistic on balance about their growth prospects for the next 12 months. However, the overall degree of confidence was the lowest in four months. Constructors cited forthcoming infrastructure work as a factor supporting business optimism.
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