May 2026 was a notably weak month for UK construction activity, with total award values falling for a fourth consecutive month to £5.1bn—down 11% and marking the lowest level since May 2025. infrastructure’s sharp contraction dragged on overall performance and is particularly significant given the sectors usual role as a stabiliser. This reflects the delays in large public schemes and continued scrutiny of capital spending. Weaker education and leisure activity suggests caution from public and private investors likely due to tighter finance and continued materials and labour costs.

There were signs of resilience in industrial and healthcare, both supported by a small number of high-value projects. While the South West rebounded strongly in contrast to a sharp decline in the East Midlands. However, residential activity softened, indicating that housing momentum has cooled in Q2 under the pressure of higher borrowing costs and affordability constraints.

April’s sharp fall in applications to £5.2bn set a weak pipeline for the months ahead, helping explain May’s continued slowdown in overall activity. The decline was broad-based, with commercial, education, and residential all dropping heavily after a strong Q1, pointing to reduced near-term project starts rather than just short-term volatility.

These monthly movements sit within wider industry trends. Elevated borrowing costs, subdued investor confidence, and planning bottlenecks continue to constrain project starts, while inflation still pressures viability. Government policy remains a key variable: commitments to infrastructure delivery, net zero investment (particularly energy-from-waste and grid upgrades), and healthcare estate renewal are supporting certain sectors, but fiscal constraints and project delays are dampening momentum elsewhere. Overall, May’s data reinforces the picture of a market lacking consistent growth drivers, with activity reliant on sporadic large projects rather than a broad-based recovery.