The construction industry is on the brink of a remarkable period of growth, with big changes expected in the years ahead. According to Glenigan, new project starts are forecast to grow by 8% in 2025, driven mainly by public sector and infrastructure projects, with an additional 10% increase projected for 2026. These figures focus on everyday activity, excluding megaprojects over £100m.
As we move into 2025, several key trends are set to redefine the sector. From the rise in public sector projects and the growth of biotech and data centres to the demand for sustainable infrastructure, the adoption of advanced technologies, and shifts in workforce dynamics, the industry is heading for a transformative year. Here’s a closer look at some of the major changes shaping the construction landscape in 2025:
Technological Innovations and Digital Transformation
Technology has for years been a cornerstone of progress in the construction industry, with digital transformation now woven into daily operations. Building Information Modelling (BIM), for example, is far from new – it is a consistently used tool for the majority of construction firms, enabling seamless collaboration among architects, engineers, and contractors. Its value in reducing errors and minimising rework has long been recognised.
What’s shaping the future, however, are newer trends like drones, robotics, artificial intelligence, and printing. Drones are transforming site surveys and safety inspections, offering unparalleled precision and efficiency, while robotics are taking on repetitive and hazardous tasks, boosting productivity and worker safety. Additionally, 3D printing is gaining traction for producing prefabricated components as it reduces waste and accelerates construction timelines.
While these technologies demand considerable upfront investment, they offer long-term benefits by cutting costs, reducing project durations, and delivering superior outcomes. For companies looking to stay competitive, embracing these innovations is no longer optional.
Sustainable Practices in Material Sourcing
Sustainability is moving to the forefront of the construction agenda in 2025. Contractors and developers are increasingly adopting innovative strategies to meet environmental goals while managing rising costs. This shift is particularly evident in the sourcing of materials like steel, concrete, timber, and insulation.
Material costs are being driven up by global supply chain challenges, increased demand, and the push for eco-friendly solutions. In response, companies are embracing greener and more-innovative material solutions and accelerating the use of recycled and renewable resources, while also implementing modern methods of construction, such as modular and hybrid techniques. These approaches combine prefabrication and advanced engineering to reduce waste, enhance productivity, and shorten project timelines.
Of course, sustainable practices are not just about cutting costs – they’re about future-proofing projects, too. Developers investing now in greener materials and processes will be better equipped to tackle the economic and environmental challenges of the coming years.
This shift is particularly timely as the UK construction sector is preparing for a reorientation in spending, transitioning from repair and maintenance activities to new builds. According to a recent report, higher borrowing costs are reshaping the industry’s priorities, reflecting both consumer demand and strategic adaptations to the evolving economic landscape. As new construction projects gain precedence, being able to offer sustainable materials and innovative solutions will play a pivotal role in meeting these shifting demands.
Impact of Regulatory Changes
Stricter UK regulations are reshaping construction, prioritising safety, sustainability, and energy efficiency. By 2025, complying with these standards will be crucial for reducing carbon emissions, improving building quality, and ensuring public safety.
The Building Safety Act, introduced in response to the Grenfell Tower tragedy, has placed greater emphasis on fire safety and structural integrity. At the same time, tighter energy efficiency standards are driving the design of greener, more sustainable buildings, though these changes may initially lead to higher costs.
Urban developers in particular will face the added complexity of evolving planning permissions and zoning regulations. Staying ahead of these regulatory changes will be essential for delivering projects on time and maintaining a competitive edge.
Addressing Labour Shortages with Innovation and Investment
Labour shortages will continue to challenge the UK construction industry in 2025. Factors such as an ageing workforce, fewer EU workers post-Brexit, and a lack of vocational training in traditional labour skills have compounded the issue.
However, this challenge also presents an opportunity. Rising wages could help make construction a more attractive career choice, while investments in apprenticeships, upskilling programmes, and digital training tools are equipping the next generation with the skills they need.
By addressing workforce shortages head-on, the industry has the chance to create a more resilient and skilled labour pool, paving the way for sustained growth and efficiency in the years ahead.