A sharp rise in new starts will lift activity next year, driven by public sector and infrastructure work, according to new data.
Industry data specialist Glenigan is forecasting an 8 per cent hike in underlying starts in 2025 compared with this year and a further 10 per cent rise in 2026r.
The forecast figures exclude megaprojects worth more than £100m to give a sense of the underlying day-to-day industry activity.
Glenigan economic director Allan Wilen said: “The construction sector is on track for growth from 2025.
“The recent Budget’s adjustments to fiscal rules, allowing for higher levels of capital investment, will unlock significant public sector and infrastructure projects, providing a much-needed boost to government-funded initiatives over the next two years.”
The analysis was backed up by Michael Cameron, senior policy analyst at political insight firm DeHavilland.
Cameron said the King’s Speech in July was “one of the busiest in years” while October’s Budget was “significant”.
He added: “For schools, £6.7bn was announced for capital and £1.4bn for the schools rebuilding programme. For the NHS, there was an additional commitment of £1bn for hospital repairs and upgrades.
“The government also confirmed, as expected, funding to deliver High Speed 2 to Euston.”
Cameron added that planning reforms and a spring Spending Review could offer further boosts for the sector.
Glenigan said civils workloads were expected to grow steadily over the forecast period, driven by water and energy projects.
A strengthening in economic growth and further interest rate cuts are also expected to buoy private housing activity over the next two years.
The Labour government is expected to boost the social housing sector while increases are expected in all sectors except for community & amenity in 2025 and education in 2026.
