The IHS Markit/CIPS UK Construction Total Activity Index signalled a decline in overall construction output for the first time since May 2020 as it fell to 49.2 in January from 54.6 in December.

New order growth fell to its weakest since June 2020 with commercial and civil engineering falls not offset by a continued rise in housing.

Construction companies continued to experience intense cost pressures, driven by rising prices for plaster, steel and timber.

The overall rate of input price inflation accelerated to its highest for just over two-and-a-half years.

Tim Moore, Economics Director at IHS Markit, said: “The construction sector ended a seven-month run of expansion in January as a renewed slide in commercial work dragged down overall output volumes.

“House building was the only major construction segment to register growth, but momentum slowed considerably in comparison to the second half of last year.

“Construction companies continued to report major delays with receiving imported products and materials from suppliers, with congestion at UK ports contributing to the sharpest lengthening of delivery times since May 2020.

“Adding to the squeeze on the construction sector, rising steel and timber costs led to the fastest rate of input price inflation for just over two-and-a-half years.

“The latest survey highlighted that construction companies have become more cautious about the business outlook.

“Output rebounded quickly after stoppages on site at the start of the pandemic, but hesitancy among clients in January and worries about near-term economic conditions resulted in a dip in growth expectations for the first time in six months.”