Financial News: UK Construction Sector Contracts Most Since 2020

UK Construction Sector Contracts Most Since 2020

06/04/2026 - 06:38:00 (RTTNews)

(RTTNews) - The UK construction sector shrank at the fastest pace in six years in May amid shrinking order books and rising economic uncertainty, survey data from S&P Global showed Thursday.

The construction Purchasing Managers' Index unexpectedly fell to 38.2 in May from 39.7 in the previous month. The reading was seen at 40.4.

The index fell below the neutral 50.0 threshold for the seventeenth straight month in May.

All three broad categories of construction work registered sharp declines in output in May. Residential activity reported the weakest-performing segment as market conditions remained unfavorable and borrowing costs stayed elevated.

Commercial construction reported a steeper reduction in output levels in May. Meanwhile, civil engineering work dropped at a slightly less marked rate than in April.

Total new orders decreased the most in six years. Construction companies suggested that project delays, deferred investment decisions and general cutbacks to clients' budgets had all resulted in fewer tender opportunities.

A decline in new orders resulted in lower employment numbers and led to another fall in input buying. Purchasing activity dropped at the fastest pace since November 2025.

Suppliers' delivery times lengthened for the third straight month and the downturn in vendor performance was the sharpest since December 2022.

On the price front, data showed that input prices increased at the fastest pace since June 2022. Subcontractor charges grew the most in nearly three-and-a-half years.

Business activity expectations for the next twelve months remained positive in May but the degree of optimism eased to the second-lowest since December 2022.

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