UK’s construction sector is experiencing a significant setback, as evidenced by the sharp fall in PMI Construction index to 45.0 in September, a level not seen since May 2020 and far below the anticipated 49.9.
The report shows a distinct contraction in the industry, with residential work plunging to an index of 38.1, indicating the steepest decline amongst all sectors. Civil engineering activity isn’t faring much better, posting a 45.7 index, while commercial building has shown some resilience, albeit still in the contraction zone at 47.7.
Tim Moore, Economics Director at S&P Global Market Intelligence, paints a grim picture of the current state of the sector. “Output levels declined across the UK construction sector for the first time in three months during September, and the latest downturn marked the worst overall performance since the early stages of the pandemic,” he stated.
The future outlook for the construction sector does not instill confidence. Moore points out that the survey’s forward-looking measures have remained somewhat pessimistic. “Order books decreased at an accelerated pace and business activity expectations eased to the lowest so far this year,” Moore explained. The decrease in project starts has led to an increase in sub-contractor availability, reaching levels not seen since the summer of 2009.
