Service sector order books have contracted at the steepest rate since the height of the global financial crisis in 2009 so far this year, with companies reporting that Brexit uncertainty has dampened demand and led to cancelled or deferred spending, exacerbating a headwind from slower global economic growth.
In a report, the firm revealed that the PMI reached 47.5 in March to mark a decline compared to February's 49.3. That was a marginal improvement on February's 49.5, though still below the 50 threshold that is meant to separate contraction from growth.
The sustained decline in total United Kingdom construction activity represented the first back-to-back fall in output levels since August 2016, although the rate of decline remained only marginal in March.
Worldwide data firm IHS Markit revealed a record-low to have been witnessed in the Eurozone Purchasing Managers' Index (PMI) for the manufacturing sector last month.
"Although global headwinds and a general slowdown in trade present some concerns for the future health of Indian manufacturers' order books, so far companies have been able to weather the storm and secure healthy inflows of new work from overseas", De Lima said.
"Furthermore, strong competition for contracts was also reported by some panel members".
Survey respondents pointed to concerns about the domestic economic outlook, which is leading to "risk aversion" among clients.
This was accompanied by subdued inflationary pressures, with rates of increase in input costs and output charges below their respective long-run averages.
"UK construction businesses ramped up their purchases of materials and other inputs, reflecting efforts to build safety stocks ahead of any potential Brexit-related disruptions".
The figures follow worrying data from the manufacturing sector on Monday, which showed that Brexit stockpiling helped fuel a surge output last month as firms sought to avoid being caught short.