The Markit/CIPS UK Construction Purchasing Managers’ Index for January fell to 50.2 from 52.2 in December.

Anything above 50 represents growth but January’s figures was the slowest increase for four months.

Residential work dipped slightly while commercial and civil engineering stood still.

Confidence in future prospects increased with many firms expecting an increase in new business wins later in the year.

Sam Teague, economist and author of the report said:“January’s PMI data indicated a difficult start to 2018 for the UK’s construction sector,underlined by business activity growth slumping to a four-month low and new orders sliding back into decline.

“A contraction in house building added to lacklustre commercial building and civil engineering markets,and reduced inflows of new work suggest overall activity could slip into decline in February.

“Furthermore, cost pressures remained intense, fuelled by shortages of input materials and high costs for imported products.

“Survey respondents reported increased hesitance among clients to invest in new projects amid heightened concerns over the UK economic outlook.

“Encouragingly, however, firms generally expect things to improve later in the year.

Constructors’ optimism towards future growth prospects reached a seven-month high.

“Many forecasted that the soft patch in construction demand would be short-lived and new project wins would pick up throughout the year, though this will inevitably depend on how Brexit negotiations play out.

“Despite the upturn, optimism remains worryingly low by historical standards.”