The news comes less than a month after research firm Global Insight forecast that the world construction market would slow in 2003.
The infrastructure and private commercial sectors were particularly badly hit. Infrastructure activity fell 24% and commercial output was 23% lower than in the same three months of 2002.
Private industrial orders dropped 6% and public non-housing orders, excluding infrastructure projects, were down 2%.
The housing sector bucked the trend. In the private market, orders rose 9% in the three months to May, and public/housing association orders increased 42%.
Construction orders for the year to May increased 7% on the previous 12 months.