March Brings a Slight Uptick in UK Construction Activity

The United Kingdom's construction sector, while still in contraction, experienced a slight improvement in activity during March, according to a recent report by S&P Global. The construction Purchasing Managers' Index (PMI) saw an increase from 44.6 in February to 46.4 in March, indicating a modest recovery.

Sector-Specific Performance Highlights

Civil engineering faced the most significant challenges, with its contraction rate accelerating to the fastest since October 2020, recording the lowest PMI at 38.8. Residential construction activity was slightly better at 44.7, followed by commercial building at 47.4.

Challenges Ahead for the Construction Sector

"The sector is grappling with a scarcity of new projects and the financial strain of rising payroll costs, leading to hiring freezes and a reluctance to replace departing staff. This has resulted in the quickest pace of job losses in nearly four-and-a-half years," explained Tim Moore, Economics Director at S&P Global Market Intelligence.