Monday, April 7, 2025

UK construction sector struggles with rising job cuts and declining demand

UK construction firms have been shedding jobs at the fastest rate in four years, driven by an ongoing decline in sector activity. March saw another contraction, marking the third consecutive month of shrinking output, though slower than in February.

The latest data from S&P Global’s construction purchasing managers’ index (PMI) revealed a reading of 46.4, slightly better than the previous month’s 44.6 but still below the 50 mark that signals growth. This indicates that the UK construction industry continues to face tough conditions, particularly within commercial construction, which saw its sharpest decline since early 2021.

Concerns over the broader economic landscape, including rising interest rates and global uncertainties, have contributed to the sector’s woes. A weak order book and subdued demand for construction projects have led to further job losses, with firms cutting staff at the highest rate since October 2020.

In particular, civil engineering experienced the largest drop in activity since 2020, while commercial construction remained relatively stronger but still contracted. Firms cited a slowdown in investment due to uncertain economic conditions and geopolitical risks. These factors, combined with an ongoing reduction in infrastructure work, paint a bleak picture for the future of the UK construction sector.

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