The index registered activity at 53.3 in December, down from 55.2 in November.

Despite this contraction, the index is still above the 50 value and has not dropped below this since March 2024.

Growth may be down but activity is still “solid” according to S&P.

In December, commercial activity was the fastest-growing area of the construction sector with an index reading of 55.0 followed by civil engineering with 52.9.

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Commenting on the figures, S&P Global Market Intelligence economics director Tim Moore said the data highlighted a “loss of momentum.”

"The slowdown in overall construction output growth reflected more subdued demand conditions in recent months, as illustrated by a further moderation in new order growth during December,” added Tim.

“Survey respondents commented on headwinds from elevated borrowing costs and the impact of fragile consumer confidence.”

Here, Shawbrook managing director of development finance Terry Woodley pointed out that commercial work hadn’t been enough to offset a dip in housebuilding activity going into December 2024.

“As such, housebuilders have kept their cards close to their chest and curbed spending on new land until the market improves,” said Terry.
 
“Despite this, developers are quietly optimistic that 2025 will see the sector turn a corner. Mortgage rates are expected to reduce and the government’s pro-housebuilding agenda should help to kickstart activity this year.”