The headline S&P Global UK Construction PMI fell to 39.7, down from 45.6 in March, signalling a steep contraction in activity and marking the fourth consecutive month of falling output. The latest reading is the lowest since November 2025 and reflects a sector struggling to replace completed work as demand softens.

Civil engineering was the worst‑performing category, registering 35.3, followed by housebuilding at 38.2. Commercial activity, which had shown relative resilience earlier in the year, slipped to 42.7 — its fastest decline of 2026 so far.

Survey respondents reported the sharpest drop in new business since November 2025, citing subdued demand, longer sales conversion times and fewer tender opportunities. Many firms linked the slowdown to the ongoing Middle East conflict, which has heightened business uncertainty and disrupted supply chains.

Weaker pipelines fed through to employment, with staffing levels falling at the quickest rate in four months. Companies noted that fewer project starts and strong wage pressures meant voluntary leavers were not being replaced.

April saw a rapid acceleration in input cost inflation, with 69% of firms reporting higher purchasing prices — up from 48% in March. Fuel surcharges, rising transportation costs and shipping disruption were the main drivers, pushing overall cost inflation to its fastest pace since June 2022.

Vendor performance deteriorated for the second month running, with lead times lengthening at the quickest rate since December 2022. Firms pointed to international shipping delays and difficulties importing materials from the GCC region.

Subcontractor prices also rose at the fastest rate in three years, adding further pressure to already‑tight margins.

Although expectations for the year ahead remained positive overall, sentiment slipped to its weakest point since November 2025. Firms highlighted concerns over:

• Rising inflation
• Elevated borrowing costs
• Fragile investment sentiment
• Geopolitical instability

Some optimism remains around long‑term infrastructure and energy projects, but most respondents expect growth headwinds to persist.

Tim Moore, economics director at S&P Global Market Intelligence, said the sector is facing one of the steepest cost shocks in decades: “Aside from the post‑pandemic surge, the latest rise in purchasing costs was the steepest in three decades of data collection… A lack of new orders contributed to the sharpest decline in business activity for five months.”

Lynsay Turnbull, regional director at Egis UK, said the data “reflects another challenging month” as cost pressures and uncertainty weigh on project viability: “Civil engineering remained the weakest‑performing sector… One of the most concerning elements is the sharp rise in input costs driven by fuel surcharges, shipping disruption and wider supply chain pressures.”

Brian Smith, head of cost management at AECOM, warned that the seasonal pickup in activity has failed to materialise: “A dip in output is a troubling sign for a period when activity typically starts to pick up… Contractors that sustain healthy pipelines will be those taking a disciplined approach to project selection while embedding AI and digital tools to drive efficiency.”

Atul Kariya, head of real estate and construction at MHA, said the sector is being “heavily squeezed” by weak demand and renewed inflation: “The bigger issue is uncertainty, which is delaying project starts and investment decisions… Unless inflation and financing conditions improve, activity is likely to stay subdued in the near term.”