The latest Glenigan report shows a sharp decline of 19% in value of work starting on, and remained 16% below 2024 levels
The Construction Index April 2025 details construction activity in Q1 2025, the three-month period to the end of March.
Construction activity sees a marked decline in most sectors in the report.
The edition focuses on underlying projects <£100m
Residential construction starts decreased by 12% against the previous three months and 2024 figures, while non-residential construction starts dropped by 24% against the last three months and were down 22% year-on-year.
Private housing construction starts declined by 11% from the last quarter and by 9% year-on-year, and social housing saw a drastic drop of 15% quarter-on-quarter and by 20% year-on-year. This data precedes the funding announced in the Spring Statement, and it is hoped that this funding will reverse this trend.
Industrial project starts saw another dramatic decline of 28% on the last quarter, and 7% year-on-year. Health saw a drop of 35% quarter-on-quarter, 36% year-on-year, and retail dropped by 34% quarter-on-quarter, and 37% year-on-year.
Civil engineering projects also declined by 28% from the previous three months, and dropped by 16% year-on-year. Infrastructure projects saw a quarterly drop of 14%, but a rise in 12% yearly. Utilities dropped by 43% for both quarterly and yearly measurements.
Community and amenity projects, however, saw a rise in quarter-on-quarter of 5% and year-on-year of 1% comparisons. This is largely attributed to the Catterick Garrison in North Yorkshire, worth £21m.
Office construction saw a measured drop of 8% quarterly, but raised by 3% yearly, while hotel and leisure dropped by 30% quarterly and 28% yearly. Education dropped by 24% quarterly, and a whole 39% yearly.
Previous Glenigan forecasts have estimated growth to start in 2025.
A wide variance in regional performance
The North East topped the charts with a 6% increase of performance quarterly, and a large 17% increase year-on-year. This is largely due to the start of several major projects in the region.
The South West saw a more tempered performance, with a quarterly decline of 14% but a 3% yearly increase. Northern Ireland saw the worst quarterly decline, with a whopping 43%, and an 11% yearly decline, while London fell 10% quarterly and 40% yearly. The South East fell by 11% quarterly and 18% yearly.
Glenigan’s Allan Wilen said: “The latest data confirm investors’ loss of confidence. Whilst seasonal factors provide a lift to starts during the first quarter against the preceding three months, starts were 16% lower than a year ago. Developers have become more hesitant to take forward projects since the turn of the year, amid a stalled economy and heightened geopolitical uncertainty. Public sector projects have also weakened during the first three months of 2025. However, increased government capital funding from April should help lift sector activity over the coming months.”
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