Housebuilding slump drags down UK construction activity, PMI shows

UK Housebuilding Slump Causes Sharp Decline in Construction Activity, PMI Reveals

UK Construction Sector Faces Steep Downturn Amid Housebuilding Crisis

PMI Data Highlights Sharp Contraction

Nov 5 (Reuters) - Britain's construction sector shrank last month at its fastest pace since June as housebuilding suffered its worst month of the year, a survey showed on Thursday.

The S&P Global UK Construction PMI fell to 43.6 from 46.1 in September, below every forecast in a Reuters poll of economists, whose median estimate had pointed to no change.

Readings below 50 denote contraction, which has been the case for the construction PMI for nearly two years.

Sector Performance Breakdown

Housebuilding Activity Plummets

• Civil engineering and commercial activity contracted, but the downturn was especially severe for the housing sector, which saw the biggest drop in activity since December 2025

• Only the COVID-19 pandemic and the global financial crisis saw greater drops in housebuilding activity than last month and December 2025

Industry Insights and Commentary

• "Construction companies commented on severe headwinds in the housebuilding sector from rising borrowing costs, weak consumer confidence and elevated economic uncertainty," said Tim Moore, economics director at S&P Global Market Intelligence

• "However, there were reports of strong demand for data centre projects, alongside rising workloads in the energy and utilities sectors," he added

Cost Pressures and Business Sentiment

Input Costs and Inflationary Pressures

• The survey's index of input costs rose to its highest level since June after jumping more than 10 points on the month, with respondents citing fuel surcharges and energy costs

Business Optimism and Outlook

• Business optimism waned to its lowest level since May

All-Sector PMI and Broader Economic Context

Comparative Performance Across Sectors

• The all-sector PMI — a combination of the construction, manufacturing and services surveys — rose to 52.1 in October from 51.5, the strongest reading since February

Reporting and Editorial Credits

(Reporting by Andy Bruce; Editing by Joe Bavier)