Worsening conditions for the UK's construction sector have been revealed with activity declining at the fastest pace for more than five years, according to the latest PMI data.

The sector’s downward trajectory continued in October, falling for the tenth month in a row and at its steepest since May 2020 – during the first major peak of the Covid pandemic.

The headline S&P Global UK Construction Purchasing Managers’ Index (PMI) – a seasonally adjusted index tracking changes in total industry activity – registered 44.1 in October, down from 46.2 in September and well below the 50.0 no change mark for the tenth consecutive month.

This marked the longest period of continuous decline since the global financial crisis more than 15 years ago.

Civil engineering remained the weakest-performing area in October (index at 35.4), with business activity falling sharply and at the fastest pace since May 2020.

Survey respondents widely cited a lack of new work to replace completed projects.

Residential work (index at 43.6) also decreased markedly and the latest decline was the greatest for eight months.

Commercial building activity meanwhile showed some resilience as the latest index reading (46.3) was little-changed since September.

Lower levels of business activity reflected a sustained downturn in new work across the construction sector.

The rate of decline accelerated since September but remained slower than seen on average in the first half of 2025.

Many construction companies noted sluggish market conditions, fewer tender opportunities and delays with the release of new projects. There were also reports that elevated political and economic uncertainty had discouraged client spending.

Shrinking workloads and increased payroll costs meant that staffing numbers were reduced again in October.

The rate of job shedding was the steepest for just over five years, with survey respondents often commenting on the non-replacement of voluntary leavers. Subcontractor usage also decreased, albeit to the least marked extent since July.

However, business activity expectations for the year ahead were positive overall in October.

Around 34% of the survey panel predict a rise in output, while 20% forecast a reduction. Although still at a historically subdued level, the latest survey indicated that business optimism edged up to its highest since July.

Lower borrowing costs, hopes of a turnaround in clients' risk appetite and favourable demand projections in areas such as energy infrastructure spending were cited as helping to boost business expectations in October.

Tim Moore, economics director at S&P Global Market Intelligence, said: “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.”

Brian Smith, head of cost management at AECOM, added: “This holding pattern of stubborn inflation, high interest rates and paused projects is clearly weighing on the sector.

“Activity has so far been relatively stable, but firms are running out of road before the lack of new work starts to have serious impacts. However, there is still an opportunity to stymie any further decline and avoid this.

“Recent planning reforms have laid vital groundwork, but legislation alone won’t deliver results. The real test is turning reform into action on the ground.

“By using digital tools and AI to speed up planning and unlocking investment through smarter public–private partnerships, the government can turn policy into progress and make every pound of infrastructure funding go further.”