04.09.202608:42:07UTC+00UK Construction Activity Drops More than Anticipated

The S&P Global UK Construction PMI slipped to 44.3 in August 2026 from 44.7 in July, falling short of market expectations of 45.5. Survey respondents reported renewed weakness in client demand, which led to a decline in new projects, particularly in residential construction starts, as lower risk appetite weighed on activity. The war in the Middle East was cited as a key factor, pushing up energy prices and borrowing costs and further dampening sentiment.

By sector, the residential work index fell sharply to 37.6, civil engineering activity declined to 40.5, and commercial construction activity softened to 47.8. In response to this broad-based slowdown, construction firms cut staff numbers.

Input cost inflation accelerated, driven by higher transportation charges, increased raw material prices, and rising fuel costs. Despite the current challenges, firms remained optimistic about the year-ahead outlook, supported by expectations of new tender opportunities.