FORECASTS for UK construction output growth have been revised down in the Construction Products Association’s winter forecasts.
Overall construction output is now expected to rise by just 1.7% this year, down from the 2.8% growth forecast in October.
Firms operating across the construction supply chain have all reported that slowdown in activity in key sectors has persisted since spring. ‘Weak fundamentals and geopolitical developments’ are expected to keep decision-makers risk-averse and lengthen the period of uncertainty holding back output growth in the private housing, private housing repairs, maintenance and improvement (rm&i) and commercial sectors.
Rebecca Larkin, CPA head of construction research, said, “We enter 2026 with little to suggest that the conditions that held back construction over the last 12 months are improving: slow economic growth, weak business and consumer confidence and risk aversion resulting in subdued activity in the major sectors of construction. With hopes of a recovery consistently dashed last year, firms in the construction supply chain are bracing themselves for another difficult year that is still laced with risks, challenges and uncertainty.
“However, there are two main primary questions remaining. Firstly, when will confidence improve enough to see homebuyers, homeowners and investors press ahead with large spending decisions and drive a pickup in house building, home improvements and large private sector projects. Secondly, will government introduce a much-needed policy to enable demand in a housing market and house building sector given that affordability remains a key constraint?
“Until then, the 1.7% growth that is forecast for construction is pinned on niche areas of activity such as commercial fit-out and refurbishment, infrastructure work on energy and water networks, as well as the effective delivery of public sector building programmes for schools, hospitals and prisons.”
