Residential building was the main reason for the drag in overall construction activity in February, being the weakest-performing segment (37.0) once again. That being said, there were also contractions in both commercial construction activity (46.5) and civil engineering work (41.0) with the latter slumping to its softest since September last year.
S&P Global notes that:
“A sharper downturn in house building was the main
factor behind the setback for UK construction activity
in February, following some signs of stabilisation at the
start of 2026. Total industry activity has decreased in
each month since January 2025 and the latest decline
was faster than seen on average over this period. The
reduction in output was largely due to sluggish demand
conditions, but some firms also noted that exceptionally
wet weather had disrupted construction projects.
“Construction companies were hopeful of a turnaround
in business activity over the year ahead, with optimism
levels hitting a 14-month high in February. This was often
linked to forthcoming new projects in the infrastructure
and energy sectors, as well as projected improvements in
broader economic conditions.
“Sharply rising input costs were a challenge in February.
The rate of purchasing price inflation hit a seven-month
high as suppliers passed on rising raw material costs,
especially metals.”
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