The latest S&P Global PMI for UK construction is out, showing the largest drop from October’s 44.1 to 39.4 in November
The November 2025 PMI shows the 11th month of contraction in construction activity for the UK.
All three sub-sectors saw a sharp downturn, with the fastest drop of activity in over five years.
Civil engineering took the hardest hit
Housing dropped to 35.4, and commercial fropped to 43.8, while civil engineering plummeted to 30.0.
New orders also saw the largest decline since May 2020, dropping the fastest since 2009 (not including the pandemic years). 44% of firms have reported a drop in new orders, and as few as 17% saw any increase.
This is indicative of a continued weakness in client confidence, economic worries, and uncertainty in the wake of the budget at the end of last month.
Of note is that this is the 11th month running that staff levels have dropped, marking nearly a year of decline for employment within the construction industry and with no sign of relief yet.
The only positive in this month’s report is that supply chain delivery times have improved to levels higher than June 2024, however, this is likely due to a drop in demand, as purchasing activity itself dropped sharply.
This puts the industry at its lowest optimism since December 2022, with 25% expecting further decline.
Tim Moore, economics director at S&P Global Market Intelligence, said: “November data revealed a sharp retrenchment across the UK construction sector as weak client confidence and a shortfall of new project starts again weighed on activity.
“Total industry activity decreased to the greatest extent for five-and-a-half years, led by steep falls in infrastructure and residential building work. Commercial construction also faced severe headwinds during November as business uncertainty in the run-up to the Budget pushed clients to defer investment decisions.
“Lower workloads, alongside pressure on margins from rising wages and purchasing costs, continued to dampen staff hiring in November. The latest round of job cuts was the most marked since August 2020.
“Construction companies also signalled a slide in business activity expectations for the year ahead as hopes of an imminent rebound in sales pipelines faded in November. The degree of optimism dropped to its lowest since December 2022 amid reports of cutbacks to client budgets and pervasive worries about long-term UK economic growth prospects.
Industry has not had a chance to recover from pre-budget jitters
The PMI released last month for October showed drops due to the then-upcoming Autumn Budget, which wasn’t released until the end of November.
Construction has a recent pattern of seeing a drop in the months leading up to the budget, due to potential tax changes or other measures that may affect the economy around the industry.
At the time, Tim Moore said: “UK construction companies reported another challenging month in October as the prolonged weakening of order books so far in 2025 resulted in the fastest decline in business activity for over five years. Civil engineering and residential activity saw the fastest rates of contraction, while commercial building showed some resilience.
“Reduced workloads were again widely attributed to risk aversion and delayed decision-making among clients, which contributed to a slower-than-expected release of new projects. Subdued demand in the wake of heightened political and economic uncertainty also led to the steepest drop in input buying since May 2020.
“Meanwhile, some positive signals for the construction sector in October included a slowdown in cost inflation to its lowest for one year, rising subcontractor availability, and a sustained improvement in supplier performance.
“Looking ahead, business activity expectations for the coming 12 months remained much weaker than the long-run survey average, largely due to worries about fragile investment sentiment and weak sales pipelines. However, overall optimism levels edged up to the highest since July as the prospect of lower borrowing costs reportedly helped to boost demand projections.”
The post November 2025 PMI drops to lowest since 2020 appeared first on Planning, Building & Construction Today.
