Modest Uptick in Construction Activity

The United Kingdom's construction sector experienced a slight improvement in March, as indicated by the latest report from S&P Global. The construction Purchasing Managers' Index (PMI) rose from 44.6 in February to 46.4 in March, signaling a modest recovery despite ongoing challenges.

Sector-Specific Performance

Civil engineering faced the steepest decline, with its contraction rate accelerating to the fastest pace since October 2020, recording the lowest PMI at 38.8. Residential construction activity showed a PMI of 44.7, while commercial building activity was slightly better at 47.4.

Employment and Cost Pressures

"The sector is grappling with a scarcity of new projects and escalating payroll costs, leading to hiring freezes and the non-replacement of departing staff. This has resulted in the most rapid job shedding in the construction sector in nearly four-and-a-half years," explained Tim Moore, Economics Director at S&P Global Market Intelligence.