UK Construction Downturn Sustains In August

(RTTNews) - The UK construction activity continued to deteriorate in August, led by weakness in the residential building segment, purchasing managers' survey data from S&P Global showed Friday.

The construction purchasing managers' Index dropped to 44.3 in August from 44.7 in July. Any reading below 50 indicates contraction in the sector.

The decline reflected subdued demand conditions and a reduction in new projects, especially in house building starts.

Among three sub-sectors, housing activity showed a faster decline. Meanwhile, commercial activity fell at the slowest pace since January, and the civil engineering activity logged the weakest decline in five months.

New orders received by British constructors continued to fall in August, linked to heightened risk aversion in the wake of the Middle East conflict and delayed decision-making by clients. Nonetheless, the rate of decrease was the slowest since September 2025.

On the price front, input costs showed a further sharp increase in August amid higher fuel, transport, and raw material costs. However, the rate of inflation eased to a 6-month low. As a result, selling prices rose at the weakest pace since March.

In line with lower new orders and price pressures, firms reduced workforce numbers and purchasing activity, with the latter falling sharply.

Looking ahead, business confidence over the year ahead eased from July's five-month high amid concerns about geopolitical tensions, lacklustre domestic economic prospects, and elevated borrowing costs.