Britain's Building Blues: A Slump in Construction

The UK's construction scene is in a bit of a slump. Last month, it hit a low not seen since the early days of the pandemic. The main culprit? A big drop in civil engineering work, thanks to shaky demand and nerves about the upcoming budget. The numbers tell the story. The PMI, a key measure of construction health, dipped to 44. 1 in October. That's down from September and way below the 50-point mark that separates growth from decline. Civil engineering took the biggest hit, with activity at its weakest since May 2020.Residential building also felt the pinch, slowing down sharply. Commercial building wasn't far behind. Experts point to caution and delayed decisions by clients as the main reasons. With political and economic uncertainty looming, demand took a hit, and input buying dropped significantly. New orders fell faster in October. Survey respondents blamed weak demand and project delays on the slowdown. The job market felt the impact too, with job-shedding accelerating. The employment index hit its lowest since August 2020. But there's a silver lining. Input inflation costs were the lowest in a year. Plus, the outlook for the next 12 months is the brightest since July. Lower borrowing costs could be on the horizon, even if the Bank of England is expected to keep interest rates steady for now.