OUTPUT in Britain’s construction sector lost momentum in January, with business activity slowing to its weakest for 10 months, as Brexit uncertainty weighed on firms.

The IHS Markit/CIPS UK Construction purchasing managers’ index (PMI) fell to 50.6 in January from 52.8 the previous month.

This missed economists’ expectations of 52.5. A reading above 50 indicates growth.

Commercial work was the weakest area of construction output, with data indicating a decline in commercial construction projects for the first time since March 2018.

IHS Markit said anxiety related to Britain’s impending departure from the EU at the end of March and concerns about the outlook for the UK economy had hit demand.

Growth in new business was also weak in January and eased to an eight-month low due to low demand for construction services and a lag in converting sales, which IHS Markit said reflected a “wait-and-see approach to spending by clients”.

Construction firms were also cautious about hiring new staff – the survey pointed to the slowest rise in employment since July 2016.

Duncan Brock, group director at the Chartered Institute of Procurement & Supply, said “Brexit continues to hamper progress and dampen client confidence.”

He added: “The biggest shock came in the form of job creation, which has managed to suffer the slings and arrows of Brexit highs and lows with solid hiring since the referendum result.”