Construction hit by wet weather as low housebuilding weakens output
The construction sector was hit by “exceptionally wet weather” in February that caused delays and led to a decline in output, new research has shown.
S&P Global’s purchasing managers’ index (PMI) showed the beleaguered sector suffered from an “accelerated downturn” in output last month.
The construction PMI dropped to 44.5, below the 50-figure mark for neutrality and lower than January’s seven-month high of 46.4.
Housebuilding was the weakest area, with its index figure coming in at 47.
Researchers said that construction firms suffered from weakness in orders and a lack of new starts on projects.
They added: “Several firms also noted that exceptionally wet weather had delayed some work on site in February.”
The survey of hundreds of company bosses showed that total new business had fallen for 13 consecutive months though there were some reported improvements in infrastructure and energy sector work.
Business expectations also hit its highest level since December 2024 while employment numbers “were close to stabilisation”, data suggested.
Residential construction drops
Tim Moore, Economics Director at S&P Global, said: “A sharper downturn in house building was the main factor behind the setback for UK construction activity in February.
“Total industry activity has decreased in each month since January 2025 and the latest decline was faster than seen on average over this period.”
Lacklustre housebuilding figures are likely to put the housing secretary Steve Reed under pressure as the government’s 1.5m homes target looks set to be missed.
There are also concerns that rising prices could hit construction companies and harm growth prospects.
The input cost index was at its highest level since the middle of last year given soaring prices for items including concrete, copper and steel.
Pantheon Macroeconomics’ Elliott Jordan-Doak said a rebound in sentiment “could come quickly when the skies clear”, though overall confidence was “chronically weak in any case”.
He added that the Bank of England could support construction businesses in the near-term by lowering borrowing costs, though there are concerns from some economists that interest rates could remain higher for longer as a result of the conflict in the Middle East.
“Another cut from the Monetary Policy Committee will support the sector, but we think activity is set to remain muted over the coming year as trade and geopolitical tensions weigh on confidence amongst builders,” Jordan-Doak said.