A fall in housebuilding has pushed activity in the UK construction industry to its lowest level for 11 years during May, new figures show.

The Chartered Institute of Purchasing and Supply (CIPS) said its Construction Purchasing Managers' Index - a measure of overall industry performance - registered 43.9 in May, the weakest reading since the survey began in April 1997.

A figure of 50 would show growth in the construction market.

Housing activity fell at the quickest ever rate, slumping to 32.7 last month from 40.3 in April, CIPS said. Conditions in the commercial building trade also worsened at their fastest rate on record.

With borrowing harder to come by due to credit crunch pressures and soaring raw material costs, the construction sector has been one of the hardest hit by the economic slowdown.

Major home builders have shelved a raft of planned schemes as the property market dries up.

Howard Archer, chief UK economist with Global Insight, said the industry was facing a "very difficult" time.

He said: "Housebuilders are deeply concerned about the current state and outlook for the sector, as activity and prices buckle under the damaging mix of elevated affordability pressures and very tight lending conditions."

UK housebuilders such as Taylor Wimpey and Barratt Developments have seen their share prices hammered over the past year as the credit crunch has taken hold. Barratt's stock is currently trading at less than one-sixth of its value a year ago.

New order levels for the construction sector fell for the third consecutive month, according to the CIPS survey, with the index reaching 45.9 in May.

Respondents reported higher availability for their services, with charge-out rates also growing at a weak rate. The commercial activity index also fell to 43.6, compared to 44.7 in April.

But activity in the civil engineering sub-sector staged a minor recovery, rising above the all-important 50 reading to 52.5 during May.

Soaring prices of metals and oil - which reached 135 US dollars a barrel last month - also have piled pressure on the sector, but the rate of raw material inflation faced by the industry also eased further last month from March's three-and-a-half year high.