S&P Global UK Construction PMI®: Output Continues to Slide in April

Key Findings:

• Slowest decline in total activity for three months as house building shows resilience
• Commercial work falls at fastest pace since May 2020
• Strong cost pressures lead to steeper pace of job shedding

Construction activity decreased for the fourth consecutive month as rising business uncertainty led to delayed decisionmaking on new projects. The latest survey indicated further declines in total order books and cutbacks to staffing numbers.

Output growth projections nonetheless edged up to the highest since December 2024.

At 46.6 in April, the headline S&P Global UK Construction Purchasing Managers’ Index™ (PMI®) – a seasonally adjusted index tracking changes in total industry activity – remained below the 50.0 no-change value, but was up slightly from 46.4 in March and signalled the slowest decline in output levels for three months.

Residential work showed a degree of resilience in April, with the rate of contraction easing to the least marked in 2025 to date (index at 47.1). Moreover, the latest reduction in activity was the slowest seen across the three sub-categories of construction work.

Civil engineering remained the weakest-performing area of construction activity in April (43.1), with the latest survey indicating a sharp rate of decline amid a lack of new work to replace completed projects.

Commercial work (45.5) decreased for the fourth month running in April and the pace of decline accelerated to its fastest since May 2020. Construction companies widely noted that heightened business uncertainty and worries about the broader UK economic outlook had weighed on client demand.

April data indicated a steep reduction in total new work and the pace of decline was the second-fastest since May 2020. Survey respondents typically commented on the impact of subdued business and consumer confidence.

Lower workloads resulted in the fastest decline in purchasing activity for nearly five years in April. Softer demand for construction products and materials contributed to a modest improvement in wait times for suppliers’ deliveries. Vendor performance has now improved in each of the past three months, although some firms continued to report international shipping delays.

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Despite weaker demand conditions, latest data indicated another sharp increase in average cost burdens. Construction companies noted that a wide range of items had risen in price, particularly concrete products, insulation and timber, but some firms noted lower fuel costs. Many firms reported that suppliers had also sought to pass on rising payroll costs.

Staffing numbers across the construction sector meanwhile decreased for the fourth consecutive month, but the rate of job shedding eased slightly since March. Subdued demand and rising pay pressures were cited as reasons for the nonreplacement of voluntary leavers.

Looking ahead, construction firms are optimistic on balance about their prospects for the next 12 months. Around 41% of the survey panel forecast a rise in output, while only 18% predict a decline. This signalled a slight improvement in business optimism to its highest since December 2024. A number of firms commented on positive expectations for residential building work, despite ongoing domestic economic headwinds and fragile client confidence.

Tim Moore, Economics Director at S&P Global Market Intelligence, said, “UK construction companies have endured a bumpy ride since the start of the year as domestic economic headwinds and hesitancy among clients led to a lack of new work to replace completed contracts.

“Output levels continued to slide in April, but the rate of decline eased to its slowest for three months. This was helped by slower reductions in residential building work and civil engineering activity.

“Commercial construction was a weak spot and lost momentum since March. Output decreased at the fastest pace for nearly five years amid reports of greater risk aversion among clients and a wait-and-see approach to major spending decisions.

“Despite a sharp and accelerated fall in input buying, strong cost pressures persisted in April. Overall input price inflation eased only slightly from March’s 26-month peak. Survey respondents commented on rising prices paid for a range of raw materials, as well as efforts by suppliers to pass on greater payroll costs.

“An encouraging development in April was a slight improvement in business activity expectations for the year ahead. Output growth projections improved to the highest level so far this year, with a number of survey respondents citing the prospect of a turnaround in workloads across the residential building segment.”

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