BCIS CapX provides a comprehensive, detailed and easy-to-use method of measuring cost movement for building and civil engineering. Widely used in the construction and infrastructure sector to help fairly allocate risk between the client and sub-contractors.
Published: 07/07/2025
S&P Global report shows construction activity still in decline
UK construction activity declined for the sixth consecutive month in June, albeit at the slowest rate in five months, according to the latest S&P Global UK Construction Purchasing Managers’ Index (PMI)(1).
The PMI, which tracks changes in the volume of business activity through a monthly survey of around 150 construction firms, registered 48.8 in June, slightly up from 47.9 in May. Anything above 50 signifies an overall increase in activity; anything below 50 represents a decrease.
Business optimism in the construction sector also fell to the lowest rate since December 2022, in part due to an accelerated dip in new orders.
Anecdotal evidence pointed to subdued sales enquiries and concerns over the UK economic outlook as key impacts on business confidence too.
Dr David Crosthwaite, BCIS chief economist, said: ‘Not the picture the construction sector was hoping for. Wider economic uncertainty prevails, and this continues to impact workloads overall. It’s no surprise to see a fall in business optimism, particularly in the ongoing absence of the project pipeline. The publication of this should hopefully spur much-needed confidence among clients.’
At a sector level, only housebuilding activity increased in June. Higher levels of residential activity were recorded for first time since September 2024 with some firms reporting an upturn in new projects and sales pipelines.
Civil engineering was the worst-performing area of construction while commercial work decreased at the fastest pace in five years. Accelerated rates of contraction in both areas contributed to the marginal decline in total construction output.
S&P Global also reported:
- The overall rate of cost inflation was the lowest since January 2025
- The smallest decline in purchasing activity in five months
- The greatest improvement in supplier performance since June 2024
- A sharp increase in purchasing costs, including higher prices for concrete, timber and insulation
- Fewer tender opportunities and intense competition
- 34% expect a rise in output in the next 12 months, 18% predict a decline
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(1) S&P Global UK Construction PMI - here
