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While latest estimates from the government’s Office for National Statistics show Britain’s construction output growing, the people at S&P Global Market Intelligence who conduct these monthly surveys disagree.

The Purchasing Managers Index (PMI) reading for September 2025 was 46.2 – still solidly below the 50.0 no-change mark, but at least marginally up from August’s 45.5 score.

All three broad sectors of the industry are stuck in reverse, with residential building work scoring 46.8), commercial construction 46.4 and civil engineering 42.9.

A lack of new project starts was again the main factor holding back construction output. September data indicated that order books deteriorated for the ninth month in a row, albeit only marginally and at the slowest pace over this period.

Survey respondents often noted that subdued demand, elevated business uncertainty and general hesitancy among clients had made it difficult to convert sales opportunities, although some firms commented on new business wins related to energy projects.

Mirroring the trend for new work, latest data indicated a reduction in employment numbers for the ninth consecutive month. Construction companies cited ongoing hiring freezes and the non-replacement of departing staff in response to fewer workloads, although some reported a rise in the recruitment of apprentices.

Some construction companies reported hopes of a boost from infrastructure spending, energy sector demand, lower interest rates and planning approvals (including the need for improvements to the Building Safety Act approvals system). However, this was offset by concerns about the UK economic outlook, cutbacks to capital expenditure plans and reports of uncertainty among clients ahead of the autumn budget.

Tim Moore, economics director at S&P Global Market Intelligence, which compiles the monthly PMI survey, said: “September data suggested that the UK construction sector faced pressure on multiple fronts as residential, commercial and civil engineering work all continued to decrease at solid rates. Lower volumes of overall construction output have been recorded since January, although the latest reduction was the slowest for three months and the downturn in new orders was the softest so far in 2025.

“Business activity expectations for the year ahead were among the lowest since the end of 2022, suggesting that construction companies remained cautious about the near-term outlook and have yet to see a turning point on the horizon. Some firms hope for a boost from lower borrowing costs and noted new sales pipelines in areas such as energy security markets and infrastructure projects. However, many survey respondents reported caution among clients ahead of the autumn budget and a general reluctance to commit to major capital expenditure projects against a subdued domestic economic backdrop.

“Weak business optimism, shrinking workloads and robust cost pressures once again led to lower employment numbers across the construction sector. Lower staffing levels have now been recorded for nine months in a row, which is the longest period of job shedding since the pandemic.”

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