The bellwether S&P Global UK Construction Purchasing Managers’ Index highlighted another challenging month registering 39.7 in April, down from 45.6 in March and indicative of a sharp fall in overall business activity.
Reduced output has been seen in each month since January 2025 and the latest reading was the weakest for five months.
Fuel surcharges contributed to a rapid increase in purchasing prices across the construction sector.
Around 69% of the survey panel reported a rise in their input costs in April (up from 48% in March), while only 2% signalled a decline.
This pointed to the fastest overall rate of cost inflation since June 2022.
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Many firms noted the pass-through of higher transportation costs by suppliers while subcontractors increased their average prices charged to the greatest extent for three years.
Tim Moore, Economics Director at S&P Global Market Intelligence, said: “A rapid acceleration of input cost inflation was seen across the UK construction sector in April. Aside from the post-pandemic surge in input prices from early-2021 to mid-2022, the latest rise in purchasing costs was the steepest in three decades of data collection.
“Around two-thirds of the survey panel reported highercost burdens in April, which was overwhelmingly linked to fuel surcharges and subsequent rises in raw material prices. Adding to supply chain challenges, the latest data also indicated longer wait times for the delivery of construction items due to international shipping delays.
“April data again signalled subdued underlying demand conditions, despite construction companies reporting pockets of growth in areas such as energy infrastructure work. A lack of new orders to replace completed projects contributed to the sharpest decline in business activity for five months.
“Expectations for construction activity over the next 12 months remained positive overall during April, but confidence levels were the lowest since last November.
“Survey respondents cited a growing list of factors weighing on construction sector optimism, including fragile investment sentiment and elevated borrowing costs, alongside continued uncertainty about the impact of the Middle East conflict on prices, supply chains and broader economic prospects.”
