UK construction activity continues to decline 

According to financial data from Standard & Poor’s, construction activity in the UK declined in every month of 2025, right up to the end of the year. This is a fairly stable trend that is also worrying British builders. So what is the overall situation in the construction market now, and how will it affect the industry in the future?

The main source: UK construction’s steep decline continues

What is the current situation in the industry?

The S&P Global UK Construction Acquisitions’ Index recorded 40.1 points in December 2025. This is higher than 39.4 points in November, but still below the neutral level of 50.0 for the 12th consecutive month. The December 2025 reading was the second lowest since May 2020, although it least not as bad as in November.
Civil engineering was the weakest category of construction activity in December (index 32.9), despite the pace of decline being softer than in November. Both residential activity (33.5) and commercial construction (42.0) fell at their fastest rates since May 2020. The December data indicate a sharp decline in the overall volume of new work across the construction sector. Every month of 2025 saw reductions in new client volumes, although the rate of contraction eased compared to November.

How will the drop in UK construction activity influence the building industry in the future?

Despite weak demand and a lack of new orders to replace completed projects, the latest survey points to a recovery in business optimism among UK construction companies. Around 37% of panel respondents expect output levels to rise over the next year, compared with 20% who forecast a decline. This marked the highest level of business confidence for five months. Several companies mentioned upcoming new work in the utilities sector, linked to investment in water and energy infrastructure. Lower interest rates and improved domestic economic conditions were also cited as factors that could help stimulate construction activity during 2026.
Fencyx, as one of the leaders, is monitoring this situation. We hope that in the new year the problem will start to improve, and we will see growth in the construction industry.

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