Construction industry trends

What are the trends shaping the UK construction industry right now? Why should they matter to you? Whether you're a contractor, supplier of construction supplies like here at Ryder Services, or project manager, staying ahead of the curve is the name of the game.

Rising building costs

The latest BCIS Building Construction Industry Forecast says that in the next five years, costs are likely to rise by 15%. Tender prices are likewise expected to go up by 19%.

Overall building output is expected to drop by 5.5% in 2024 compared with 2023, largely due to a downturn in the output in private commercial, housing, and industrial sectors. But the sector is likely to return to growth in 2025.

Construction material price slow down

Construction materials for all work prices fell by 0.9% from June 2023 to June 2024 in the UK. Other New Work - as defined by the UK Department for Business and Trade- dropped by 2.3%.

New Housing prices and Repair and Maintenance prices increased by 0.7%, while the most significant annual drops were in fabricated structural steel, grave, sand, clays, and kaolin – a combined reduction of 16.2%. Conversely, flexible pipes and fittings, and metal doors and windows grew respectively by 17.4% and 16.1%.

Green construction and sustainability

Gone are the days when sustainability was just a box-ticking buzzword. The UK government’s goal is to reach net-zero carbon emissions by 2050. Construction companies are being asked to adopt greener methods, from sourcing eco-friendly materials to reducing waste on-site.

The UK green building market was valued at £4.6bn in 2023 and is expected to keep growing, with a predicted CAGR (compound annual growth rate) of over 9% from 2023–2028.

Modular and prefabricated construction

Modular and prefabricated construction entails manufacturing parts of a building off-site to assemble on-site. By reducing construction time and limiting the potential for delays caused by bad weather etc., modular construction can help projects stay on time and budget.

An industry forecast report by Inkwood Research says that the global prefabricated construction market is expected to reach £210bn by 2032 – achieving a CAGR of 8.7% during the forecast period of 2023–2032.

Time and cost efficiency are the two biggest factors driving this trend. The UK government’s push to build affordable housing has also highlighted modular construction as a solution for creating homes quickly and efficiently.

Digital technologies and construction

Building Information Modelling (BIM) is now standard practice on many large-scale projects in the UK. It allows contractors, architects, and engineers to collaborate on a single digital platform.

Then there's the rise of smart buildings and IoT (Internet of Things) in construction. Smart sensors, AI-powered systems, and automated equipment monitor progress, track resources, and even predict potential issues.

For construction suppliers, integrating technology into the supply chain could streamline operations and improve logistics. Offering tech-enabled services such as smart inventory management or online tracking of deliveries could give you an edge over competitors.

Labour shortages, construction robots, and drones

The UK construction industry isn’t immune to the labour shortages affecting many sectors, and according to a recent About Apprenticehips study, the industry will need 217,000 new workers by 2025 to meet growing demand.

Anticpated to grow at a CAGR of 15.3% from 2022–2031, the construction robots market is huge part of the shape of construction things to come. Robotic technologies also involve upskilling workers to ensure construction robotics are used effectively and correctly.

A further technological approach to raising construction efficiency drone use. Drone usage in the US has led to a 61% increase in measurement accuracy when applied to stockpile management. Companies using drones have likewise reported a 53% time reduction for gaining data insights and a 65% improvement in overall communication.

Health & safety

The introduction of new technologies, such as wearable devices that track worker health and safety in real time, is enhancing risk assessments. Ergonomically-designed tools, equipment with better safety features, or even providing educational resources on safe working practices are likewise all strong trends.

Retrofit and Refurbishment

Retrofitting and refurbishing existing buildings is another construction industry trend. The UK government’s push for energy-efficient buildings has also made retrofitting a priority, upgrading older building to meet modern standards.

It reduces the environmental impact by reusing existing structures, and can be more cost-effective. It allows buildings to be modernised without the high costs of demolition and reconstruction. For the construction sector, this means a growing market for specialised materials and services tailored to refurbishment projects.

Sources:

ukconstructionweek.com
constructionnews.co.uk
bregroup.com
ciob.org
gov.uk
aboutapprenticeships.com