Market Confidence and Project Starts Drive UK Civil Engineering Growth
The civil engineering sector is making a robust comeback in 2024, marked by a projected 26 percent increase in project starts, according to Glenigan’s latest UK Construction Industry Forecast. This recovery comes on the heels of a challenging 2023, during which the sector experienced a 6 percent decline in activity.
One of the primary drivers of this resurgence is the rise in smaller-scale projects, particularly those valued under £100M. While the cancellation of several high-profile infrastructure projects could have hampered growth, these smaller initiatives have been instrumental in stabilizing the market. Renewed private sector confidence is also playing a critical role, with activity anticipated to gain further traction in the latter half of 2024 as political stability improves following the general election.
This positive momentum is setting the stage for further expansion in the coming years. Glenigan forecasts moderate growth of 5 percent in 2025 and a stronger 7 percent in 2026, underpinned by continued recovery in market confidence and a steady rise in private construction activity.
Infrastructure investments power civil engineering expansion
Infrastructure development is emerging as a cornerstone of the civil engineering sector’s growth, with significant contributions from key industries like water and energy. Water companies, for instance, are gearing up for the next five-year asset management period, AMP8 (2025-2030). This ambitious initiative includes doubling capital investments to support projects such as the construction of new reservoirs, strategic water transfers, and the enhancement of river quality.
In the energy sector, transformative projects are fueling growth. The Great Grid Upgrade, alongside SSEN’s Pathway to 2030 and SP Energy Networks’ £5.4 billion transmission enhancement, underscores the sector’s commitment to modernising the National Grid. Renewable energy projects, including offshore wind farms and smaller ventures in onshore wind and solar PV technologies, are further bolstering the outlook for energy infrastructure.
Adding to the momentum, the Sizewell C nuclear project has achieved key milestones, including the granting of its Development Consent Order and a nuclear site license in early 2024. These developments signal not only progress in the energy sector but also a broader commitment to sustainable, large-scale infrastructure projects.
Government funding and major projects provide sector momentum
The civil engineering sector is also benefiting from targeted government support, which is expected to provide significant momentum in the years ahead. Short-term measures, such as the allocation of £500M for road repairs, are contributing to the stability of infrastructure projects and supporting the broader recovery.
Major initiatives like the HS2 rail tunnel to Euston remain a central focus, with plans to maintain progress despite broader challenges within the project. Other high-impact ventures, including the TransPennine route and East-West rail link upgrades, underline the government’s commitment to expanding and modernising the UK’s transport infrastructure.
An important milestone in 2025 will be the anticipated Spending Review, which is expected to provide clarity on funding allocations and project timelines.
Bright outlook for civil engineering through 2026
Looking beyond 2024, the civil engineering sector appears poised for sustained growth, with forecasted increases of 5 percent in project starts in 2025 and 7 percent in 2026. These projections are supported by a combination of public and private sector investments that reflect growing confidence in the industry’s future.
However, challenges remain. The balance between public and private funding will need to be carefully managed to maintain momentum, particularly as government budgets face scrutiny. Additionally, navigating potential delays in large-scale projects and ensuring that environmental targets are met will be critical to sustaining this growth trajectory.
Opportunities abound in renewable energy and infrastructure modernisation, from offshore wind farms to strategic water management projects. By capitalising on these areas, the civil engineering sector can build on its current recovery and lay the foundation for long-term resilience and innovation. Despite the hurdles of recent years, the industry is leveraging renewed market confidence, substantial infrastructure investments, and government support to drive forward.
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