The latest results for the Markit/CIPS UK Construction PMI index showed a June figure of 53.6 compared to 54 in May. Any reading above 50 represents a rise in activity and the index posted growth for the sixth month in succession.

However, confidence levels weakened sharply among purchasing professionals from May’s 12 month high to sink to their lowest point since December 2010.

Steve McGuckin, UK managing director of project and construction consultant Turner & Townsend, comments: “Although the figures show a slight improvement in June, look beneath the surface and the data reveals the churning below.

“New construction orders increased for the sixteenth month in a row, but the rise was the weakest since January. And writ large through the data is a lack of confidence - the sector shed more jobs in June than in the preceding five months.

“We’ve seen a new buzzword enter the construction lexicon – ‘releasing value’ rather than ‘creating value’.

“Rather than run the risk of building from scratch, we’re seeing many developers seeking to consolidate or refurbish their existing assets. In investment terms, domestic confidence has improved in the past year but is still far from robust. The most bullish investors are primarily those from overseas.

“Many foreign sovereign wealth funds still see London as a good long term investment. But their focus is entirely within the M25. Further afield does not hold the same appeal.”