The UK construction sector showed tentative signs of improvement in May, with the latest data suggesting that the prolonged downturn may be starting to ease. While activity remains subdued overall, weaker declines in output and new orders have raised cautious optimism for the months ahead.
Signs of Recovery Emerging
According to the S&P Global UK Construction PMI® for May, the headline index rose to 47.9, up from April’s 46.6, signalling the slowest reduction in activity since January. Although still below the neutral 50 mark, which separates growth from contraction, this uptick suggests that the worst of the downturn could be over.
House Building continues to lag, with the residential segment posting an index of 45.1 and demand remaining weak. Civil engineering also contracted at 45.9, extending its decline for a fifth month. However, commercial construction fared better, dipping only slightly to 49.5, its smallest fall since January.
Encouragingly, new orders fell at their slowest rate in four months, and business confidence improved to its highest since December 2024. Nearly 40% of firms surveyed expect output to rise over the next year, citing hopes of a housing market recovery, increased infrastructure investment, and lower borrowing costs.
Jobs and Supply Chains Still Under Pressure
Despite the easing in output declines, employment in the construction sector continued to shrink, with job losses accelerating to levels not seen since 2020. Weak order books have also led to reduced purchasing, easing supplier pressures and improving delivery times, even as input prices continued to climb.
The outlook remains mixed, with lingering concerns over the UK economy and ongoing uncertainty in client spending plans tempering expectations. Yet the sector’s gradual improvement could present new opportunities, particularly for those interested in builders merchants jobs, which play a role in keeping construction projects supplied and on schedule. For those interested in builders merchants jobs, specialist sites like https://bmcareers.com/distributors-and-builders-merchants-vacancies/ are a good place to start.
Tim Moore of S&P Global summed up the sentiment: “While output and hiring remain in decline, the slowdown is far less severe than earlier this year, suggesting the worst of the cutbacks may now be behind us.”
