SME builders saw another period of positive growth in the second half of 2025, with workloads and enquiries remaining in the black. But momentum has slowed compared with earlier in the year, as rising costs, skills shortages and wider economic uncertainty continue to weigh on firms.
The latest State of Trade Survey, covering July to December 2025 (H2), shows that workloads remain strong, even as enquiries soften. Nearly half of firms report job delays linked to a lack of skilled tradespeople, and concerns around costs and recent policy changes are shaping expectations for the year ahead.
Commissioned by the Federation of Master Builders (FMB) and the Chartered Institute of Building (CIOB), the survey captures the real‑world experience of SME construction firms across the UK. This edition is based on 493 responses from FMB members, CIOB companies and businesses outside both organisations.
Key takeaways
Market snapshot
- Workloads: +22%
- Enquiries: +18%
- Employment: +17%
Growth has slowed compared with H1, but demand and hiring remain positive, showing that SME builders are still busy despite wider uncertainty.
Nation‑by‑nation trends
- England: Workloads +22%, Enquiries +19%
- Scotland: Workloads +28%, Enquiries +16%
- Wales: Workloads +7%, Enquiries +14%
- Northern Ireland: Workloads +35%, Enquiries +12%
Workloads remain strong across all nations, though enquiry levels have eased most in Wales and Northern Ireland when compared with H1, showing that confidence is recovering unevenly across the UK.
Skills and recruitment pressures
- 35% increased number of staff; 18% reduced total employees
- Hardest roles to fill: carpenters (30%), bricklayers (29%), plumbers/HVAC (23%)
- High difficulty finding staff with:
- Heritage skills (58%)
- New technologies (58%)
- Sustainable building practices (57%)
- Knowledge of planning reforms (56%)
Shortages in both traditional trades and emerging specialist skills continue to hold back firms as building standards and technical requirements evolve.
Impact of skills shortages on projects
- 72% affected by lack of skilled tradespeople
- 49% had job delays
- 30% paused expansion plans
- 22% saw job cancellations
Skills shortages are now materially constraining growth and delivery, making it harder for small builders to keep projects on schedule and take on new work.
Outlook for 2026
- 48% positive about H1 2026
- Expected negative impacts from:
- National Insurance changes (47%)
- Autumn Budget 2025 (46%)
- Most positive development: Relaxation of Biodiversity Net Gain rules (32%)
Builders remain cautiously optimistic, but policy changes and rising overheads are dampening confidence as firms head into 2026.
Download the report
About the State of Trade Survey
For more than 30 years, the State of Trade Survey has tracked key trends in the SME construction sector. It is the only survey of its kind focused exclusively on small and medium-sized building firms across the UK.
The survey is published twice a year and provides insight into current market conditions and future expectations.
