The construction industry in the UK is estimated to grow in real terms by 1.6% in 2025, supported by investments in the commercial and energy sectors, coupled with an improvement in consumer confidence, amid low interest rates. In November 2025, the Bank of England has maintained the interest rate at 4%, after lowering it from 4.25% in July 2025 to 4% in August 2025. According to the Office for National Statistics (ONS), the total value of construction output grew by 1.3% year-on-year (YoY) in September 2025, following YoY growths of 1.1% in August and 2.1% in July 2025. Growth in 2025 is also estimated to be supported by allocations under the UK’s 2025 Autumn Budget Statement that was released on November 26, 2025, for the Financial Year (FY) 2025-26 (April 6, 2025, to April 5, 2026). Some of the major allocations include GBP203.4 billion ($262 billion) for the health and social care sector, GBP95.2 billion ($122.6 billion) for the Department for Education, GBP8.1 billion ($10.4 billion) for transport sector and GBP1.9 billion ($2.5 billion) for energy security and net zero.
Over the remaining part of the forecast period, the construction industry is expected to register an average annual growth rate of 3.2% between 2026 and 2029, supported by investments in infrastructure, data centers, housing, and renewable energy projects. Under the ‘’Clean Power 2030 Action Plan’’, the government is targeting to generate approximately 95% of the country’s electricity consumption from clean energy sources by 2030 and reduce carbon emissions by 80%, compared to 1990 levels, by 2035. To support this, the local electricity operator Scottish Hydro Electric Transmission (SSEN) is aiming to invest GBP22 billion ($28.3 billion) in developing the transmission lines in Scotland by 2031. In another development, the American technology company Microsoft has pledged in September 2025 to invest GBP22 billion ($30 billion) to build artificial intelligence (AI) infrastructure in the UK by 2028.
Over the remaining part of the forecast period, the construction industry is expected to register an average annual growth rate of 3.2% between 2026 and 2029, supported by investments in infrastructure, data centers, housing, and renewable energy projects. Under the ‘’Clean Power 2030 Action Plan’’, the government is targeting to generate approximately 95% of the country’s electricity consumption from clean energy sources by 2030 and reduce carbon emissions by 80%, compared to 1990 levels, by 2035. To support this, the local electricity operator Scottish Hydro Electric Transmission (SSEN) is aiming to invest GBP22 billion ($28.3 billion) in developing the transmission lines in Scotland by 2031. In another development, the American technology company Microsoft has pledged in September 2025 to invest GBP22 billion ($30 billion) to build artificial intelligence (AI) infrastructure in the UK by 2028.
The Construction in the UK - Key Trends and Opportunities to 2029 (Q4 2025) report provides detailed market analysis, information, and insights into the UK’s construction industry, including:
- The UK’s construction industry's growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the UK's construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Report Scope
This report provides a comprehensive analysis of the construction industry in the UK. It provides:
- Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in the UK, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to Buy
- Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
- Assess market growth potential at a micro-level with over 600 time-series data forecasts
- Understand the latest industry and market trends
- Formulate and validate business strategies using the analyst's critical and actionable insight
- Assess business risks, including cost, regulatory and competitive pressures
- Evaluate competitive risk and success factors
Table of Contents
1 Executive Summary2 Construction Industry: At-a-Glance6 Construction Market Data
3 Context
4 Construction Outlook
5 Key Industry Participants
7 Appendix
List of Tables
List of Figures
