French Construction Sector Weakens Further

The S&P Global France Construction PMI fell to 38.2 in June 2026 from 39.6 in May, signaling a faster contraction in construction activity. The downturn remained broad-based, led by the commercial sector, where activity declined at the steepest pace since May 2020. Housing construction also contracted more sharply, while civil engineering posted its softest decline since January. Meanwhile, new orders continued to fall sharply, extending more than four years of declining demand amid weak client interest and intense competition. Firms also reduced employment and purchasing activity as they adjusted to lower workloads. Although input cost inflation eased to a three-month low, it remained well above levels seen before the Middle East conflict. Business confidence also weakened as firms grew more pessimistic about the year-ahead outlook amid competitive pressures and the broader economic environment.

The S&P Global France Construction PMI rose to 39.6 in May 2026 from 38.1 in April, signaling a slight improvement in operating conditions. The pace of decline in construction activity and new orders moderated, while contractions in commercial and residential building eased. Despite the improvement, the index remained well below the 50 threshold. Construction activity stayed among the weakest since the pandemic, led by the sharpest contraction in civil engineering work in nearly five-and-a-half years. Weak demand prompted firms to cut both permanent and temporary jobs, while construction companies continued to reduce purchasing activity. Input cost inflation remained at its second-highest level in three-and-a-half years, driven by higher energy prices linked to the Middle East conflict. Looking ahead, firms remained pessimistic about the next 12 months, citing weak tender activity, intense competition, and subdued demand.

The S&P Global Construction PMI in France fell to 38.1 in April 2026 from 38.4 in March, extending the prolonged downturn that has gripped the sector since June 2022. The reading signaled the steepest contraction in construction activity since September 2024, as all three monitored segments posted solid declines. New orders fell at the fastest pace since May 2020, underscoring weak underlying demand, attributed to international uncertainty, local elections and uncompetitive pricing. At the same time, employment declined, marking two years of continuous job cuts and the sharpest drop in five months. Although demand pressures eased, supplier performance deteriorated to the greatest extent in three years. Cost pressures intensified as the war in the Middle East led input price inflation to soar. Energy, oil and oil-based prices surged, with a record rise in the underlying index driving inflation to its highest level since November 2022. The business outlook weakened further.