He added: “Softer growth forecasts for the United Kingdom economy alongside uncertainty ahead of the European Union referendum appear to have provided reasons for clients to delay major spending decisions until the fog has lifted”.
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Economists said the PMI surveys suggest growth overall in the second quarter may slow to around 0.2%, which would be the weakest growth since 2012.
Britain’s construction industry experienced its worst month in nearly three years in April and “sunnier times may still be a way off”, according to a new report.
The closely watched Markit/CIPS UK Manufacturing purchasing managers’ index showed a reading of 49.2 in April – the first time the index has fallen below the critical 50 mark since March 2013.
While the services sector continues to struggle, April marked the 40th consecutive month of expansion (above 50), the second longest in survey history.
David Bole, chief executive at the CIPS, said, “An atmosphere of deep unease is building throughout the manufacturing supply chain, eating away at new orders, reducing British exports and putting more jobs at risk”.
Employment in manufacturing contracted in April and official data has shown that the number of people out of work rose for the first time since mid-2015 in the three months to February.
Construction companies cited several factors weighing on client spending, including heightened uncertainty about the economic outlook and a general unwillingness to commit to new projects.
New business growth picked up slightly but remained relatively subdued, while business optimism was the joint-weakest in over three years.
Builders are also taking on more sub-contractors rather than hiring staff to “tide them over until the outlook becomes clearer”, Mr Noble said.
Howard Archer, chief United Kingdom and European economist at IHS Global Insight, said: “There is now compelling evidence that heightened uncertainty ahead of June’s referendum on EU membership is taking an increasing toll on economic activity”.
The service sector data is seen as key to gauging the overall health of the United Kingdom economy, as it accounts for more than three quarters of gross domestic product.
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He predicts United Kingdom growth will slow further, to 0.3% in the second quarter, or even 0.2% if the services sector also begins to suffer.
