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Longest UK Construction Slump Continues Despite Brightening Outlook
5 Mar
Summary
- UK construction activity contracted for the 14th consecutive month in February.
- Business optimism reached its highest point in 14 months.
- Wet weather and rising costs exacerbated the sector's prolonged downturn.
Activity in the UK construction sector has contracted for the 14th consecutive month, marking the longest downturn since the global financial crisis. In February, the S&P Global UK Construction PMI fell to 44.5, a decrease from the previous month and below economists' forecasts. This persistent sub-50 reading, indicating contraction, began in January 2025.
A rare positive note was the significant rise in business optimism, which climbed to its highest level in 14 months. However, this optimism did not translate into increased activity. A sharper decline in house building was a primary driver of the February downturn.
Factors contributing to the sector's weakness include sluggish market conditions, disruptive wet weather, and the most significant rise in cost pressures observed since July 2025. Residential building activity, commercial construction, and civil engineering all experienced declines, impacting the government's target to build 1.5 million homes.
