{"id":870462,"date":"2025-09-04T21:13:09","date_gmt":"2025-09-05T02:13:09","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2025\/09\/04\/construction-output-continues-its-downward-decline-in-august\/"},"modified":"2025-09-04T21:13:09","modified_gmt":"2025-09-05T02:13:09","slug":"construction-output-continues-its-downward-decline-in-august","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2025\/09\/04\/construction-output-continues-its-downward-decline-in-august\/","title":{"rendered":"Construction output continues its downward decline in August"},"content":{"rendered":"
\n

Business activity in the UK construction sector fell for the eighth month in a row, according to the latest\u00a0 Purchasing Managers\u2019 Index (PMI) figures from S&P Global.<\/p>\n

Despite the decline registering a slower pace than in July, business activity projections for the year ahead were the least optimistic since late 2022.<\/p>\n

S&P Global\u2019s headline PMI hit 45.5 in August, an increase from 44.3 in July, which was the lowest reading for just over five years. Any reading below 50 indicates a contraction and while there was a slight improvement on July\u2019s figure, S&P said it was \u201cindicative of another solid decline in overall construction output\u201d.<\/p>\n

The overall construction PMI number was dragged lower in August by steep declines in civil engineering (38.1) and residential (44.2) activity. At 47.8, commercial building provided a little support to the headline figure.<\/p>\n

While total new orders slumped for the eighth month in a row, they did so at their shallowest rate of decline since January.<\/p>\n

\u201cThere were some positive signals on the supply side as vendors\u2019 delivery times shortened, subcontractor availability improved and purchasing price inflation hit a 10-month low,\u201d said Tim Moore, Economics Director at S&P Global Market Intelligence. \u201cHowever, easing supply conditions mostly reflected subdued demand and a lack of new projects.<\/p>\n

\u201cElevated business uncertainty and worries about broader prospects for the UK economy meant that construction sector optimism weakened in August. The proportion of panel members expecting a rise in output over the year ahead was 34 per cent, down from 37 per cent in July and lower than at any time since December 2022.\u201d<\/p>\n

Brian Smith, head of cost management at Aecom, said in the current market conditions contractors need to \u201ckeep a tight grip on cashflow and costs\u201d and be aware of the risks to their businesses should the economic environment deteriorate further. The government\u2019s infrastructure plan and the \u00a3725bn of public money that backs it are key, he said.<\/p>\n

\u201cUnlocking projects, accelerating delivery and providing the certainty required for long-term planning will only be possible if the public and private sectors work in partnership to convert investment into tangible outcomes that reshape the UK\u2019s economic and social landscape,\u201d Smith added.<\/p>\n

The benefits from that investment and those tangible outcomes will take time to filter through, said Huda As\u2019ad, Accenture\u2019s infrastructure and capital projects lead in the UK and Ireland. In the current uncertainty, he said the industry should \u201cfocus on making their supply chains more resilient by adopting modern building methods and digitising operations\u201d.<\/p>\n

\u201cThe construction sector has the opportunity to power the UK\u2019s economic recovery, but it requires decisive action,\u201d As\u2019ad added.<\/p>\n

Richard Green, construction partner at law firm Gowling WLG, agreed, saying that companies were adapting strategies and making efficiencies where they can in the current climate, \u201cdemonstrating a steadfast commitment to delivering vital projects\u201d.<\/p>\n

\u201cInvestors will be watching closely for signs of stability and renewed momentum as we head into the autumn months,\u201d he added.<\/p>\n

Meanwhile, data released by Glenigan today (4 September) showed the value of work starting onsite fell by 4 per cent in the three months to the end of August and was 6 per cent lower than the figure for the same period last year.<\/p>\n

According to Glenigan, \u201cpersistent international socioeconomic pressures\u201d and an erosion of investor and consumer confidence caused by \u201cunpopular government policies\u201d led to starts onsite falling 18 per cent in the residential sector in the three-month period to the end of August.<\/p>\n

\u201cThe uptick in residential activity observed during the spring and summer, which drove the majority of the recent impressive growth, is starting to slow as autumn starts,\u201d Glenigan said in its latest index report.<\/p>\n

Overall, Glenigan economist Drilon Baca noted that while many contractors and subcontractors, especially in the residential sector, will be \u201cdeeply frustrated\u201d at the evaporation of the summer optimism, the construction industry remains in a far stronger position than it was last winter.<\/p>\n

\u201cHowever, we need to be cautious,\u201d he added. \u201cThere remains a high degree of uncertainty. In the lead-up to the widely-rumored Autumn Budget Statement, the sector will not be helped by persistent international pressures and, closer to home, ongoing speculation around property tax increases.\u201d<\/p>\n<\/div>\n

Read More<\/a>
\n Matthew Davies<\/p>\n","protected":false},"excerpt":{"rendered":"

Business activity in the UK construction sector fell for the eighth month in a row, according to the latest\u00a0 Purchasing Managers\u2019 Index (PMI) figures from S&P Global. Despite the decline registering a slower pace than in July, business activity projections for the year ahead were the least optimistic since late 2022. S&P Global\u2019s headline PMI<\/p>\n","protected":false},"author":1,"featured_media":870463,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2808,23494],"tags":[],"class_list":{"0":"post-870462","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-construction","8":"category-output"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/870462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=870462"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/870462\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/870463"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=870462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=870462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=870462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}