Fluctuating output contributes to continued year-on-year decline
Project-starts rise by a third in three months to April, but continue to fall against the previous year
Main contract awards decrease 10% compared to last year, despite upturn in major projects
Detailed planning approvals rise by over 50% against 2024 and three months to April, solely attributed to greenlit Lower Thames Crossing
Today, Glenigan, powered by Hubexo (Glenigan), one of the construction industry’s leading insight and intelligence experts, releases the May 2025 edition of its Construction Review.
The Review focuses on the three months to the end of April 2025, covering all major (>£100m) and underlying (<£100m) projects, with all underlying figures seasonally adjusted.
It’s a report providing a detailed and comprehensive analysis of year-on-year construction data, giving built environment professionals a unique insight into sector performance over the past year.
Short-term relief
The sector will welcome a 33% rise in project-starts compared to the preceding three months, an invigorating 29% improvement compared to April’s Review.
This increase is primarily due to a tentative uptick in underlying starts, particularly in key verticals like private housebuilding.
However, despite this recent reversal of fortune (reflecting last week’s GDP uplift), general economic consensus predicts this upturn is likely to be short-term as market volatility continues.
Persistent big project drought dampens activity
The short-lived success is put into stark relief when comparing annual performance. Unfortunately, these good results are offset by a 17% overall activity fall (combining major and underlying results) compared to the same period in 2024, with the lack of major projects dragging down otherwise encouraging growth.
Likely spurred by the Government’s delay in publishing its Spending Review and departmental strategies. Many contractors and subcontractors will be keen to see this situation resolved within the current quarter to kick-start activity in H2 2025.
It shows the sector is still battling against a tide of political indecisiveness and economic uncertainty, particularly when it comes to public sector funding for critical infrastructure.
A question of confidence affects contract awards
The development pipeline for major projects painted a more positive picture, with sharp rises in contract awards. This indicates potential future recovery should public and private sector confidence improve.
However, this was not enough to prevent an overall decrease in main contract awards, which fell by almost a third in the three months to April’s end (-29%), declining by 10% compared to last year.
Single-issue spike in planning approvals
Detailed planning approvals also rose sharply, dramatically increasing 52% compared to the previous year and 51% over the previous three months.
However, digging deeper into the data reveals these impressive figures are the result of one project: the Lower Thames Crossing. When the contribution of such major projects is excluded, underlying planning approvals, which make up the majority of construction activity, posted weak results, falling against the preceding three months and last year.
Commenting on the May Review, Glenigan’s Economic Director, Allan Wilen, says,
“The results are superficially impressive, but a closer look reveals a sector still struggling to reestablish its foothold. It’s hardly surprising. UK construction is continuing to adjust to mercurial market conditions, sometimes having to respond in the moment to the constantly shifting international and domestic economic landscape. Particularly, higher operational costs, likely to keep rising in the near future, mean clients are delaying investment decisions. Likewise, contractors are lukewarm to putting shovels in the ground right now when funding is not forthcoming.
He concludes, “There’s no denying US tariff policy has definitely exacerbated the uncertainty. However, steps to de-escalate trade tensions may go some way to improving the current situation, with steps like the US-UK tariff deal going some way to improving confidence over the coming months. Furthermore, the Government clearly setting out its strategic store will also help to boost momentum as more promised public works are greenlit.”
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Glenigan | Powered by Hubexo is the trusted provider of UK construction project data, market analysis and company intelligence. Combining comprehensive information gathering with expert analysis, it delivers timely insight into UK construction activity. Glenigan customers include government agencies, construction companies and suppliers of materials and services to the industry.
Glenigan | Powered by Hubexo data covers all construction sectors, including education, health, hotel and leisure, industrial, infrastructure, offices, private housing, retail, social housing, and utilities, and spans across all regions of the UK and ROI.
Providing accurate, high-quality information and analysis for a variety of professional and governmental bodies, Glenigan is also an officially accredited data supplier for the Office of National Statistics.
