UK Construction Sector Sees Slowest Contraction Since January
The UK construction sector experienced its slowest pace of decline this year in September, though it continues to shrink for the 21st consecutive month.
The S&P Global Market Intelligence reported that the UK construction sector saw its slowest pace of contraction this year in September. The UK Construction Purchasing Managers’ Index (PMI) rose to 46.1 from 44.3 in August, marking the least marked downturn in output since January.
Despite this stabilization, the industry has shrunk every month since January 2025, the longest continuous stretch of decline since the 2008 financial crisis. Commercial construction and civil engineering showed the most resilience, while housebuilding remained the weakest segment due to poor market conditions and high borrowing costs. Employment has fallen every month since January 2025, with September recording the fastest rate of job losses in five months.
Business optimism fell to its lowest level since May as firms faced the fastest contraction in new orders since June. Industry leaders cited geopolitical tensions, international shipping delays linked to the Middle East conflict, and rising fuel and transportation costs as primary drivers of supply chain disruption. While infrastructure projects and data center developments provide some support, sector confidence remains fragile ahead of the upcoming Budget.
