The UK construction sector is regaining momentum in 2025, with workloads rising and firms taking on more staff, as shown in our latest State of Trade Survey. However, persistent shortages of skilled workers and rising costs mean that many homeowners could still face delays, higher prices, or even cancelled projects when planning building or renovation work.
The good news: Business is picking up
There’s cause for cautious optimism. Workloads, enquiries, and employment are all up - the first time since Q2 2023 that all three are growing together. Workloads surged by +25%, enquiries climbed +34%, and employment rose +26%, the strongest quarterly improvement since Q1 2010.
But the reality on the ground
- Delays and cancellations are still hurting homeowners:
Over 60% of builders are struggling to find skilled tradespeople. 49% report job delays, and 23% have had to cancel work entirely. - Planning red tape is still a frustration:
For 38% of those facing delays, planning approvals are the primary culprit slowing projects. We know all too well how red tape can tie up timelines, especially for SMEs. - Costs keep climbing. The pressure on margins is real:
- 75% of builders have seen material prices rise.
- 67% report higher wages.
- 61% have passed costs on by increasing prices.
What this means for builders
The survey results point to both opportunity and challenge within the industry. On the positive side, workloads and enquiries are climbing, and firms are increasing their workforce to meet demand. This recovery suggests that confidence is returning, and there is potential for growth across many parts of the sector.
However, persistent barriers continue to hold firms back. Recruitment remains one of the most pressing issues, with carpenters, roofers, plumbers, and other skilled trades still difficult to source. Rising material and wage costs are another key pressure point, putting margins under strain even as workloads expand. In addition, planning delays and regulatory requirements are frequently cited as obstacles that prevent projects from progressing at the pace the market requires.
Taken together, the findings show that while the sector is moving in the right direction, the recovery is not without its risks. Addressing the skills shortage, tackling cost pressures, and streamlining planning processes will be central to ensuring that momentum is sustained and that businesses can continue to grow without being forced to turn down work or pass on higher costs to clients.
Why your voice matters
The SME State of Trade Survey is crucial to how we understand and advocate for your industry. It is read by senior officials across Government, and your feedback shapes policy - and ultimately helps reduce the barriers you face on the ground.
Read the full report to get all the stats, insights, and forward-looking trends.
In summary
The recovery is underway, but it's not yet smooth sailing - workloads and hiring are up, but skills shortages, planning delays, and rising costs continue to pinch both builders and homeowners alike.
If you haven’t already, take a moment to read the full report, and check out the comments from both the FMB and the CIOB.
