{
  "query": "UK construction cost inflation 2024-2026 steel industry benchmarks",
  "raw_results": [
    {
      "url": "https://www.arcadis.com/en-gb/insights/perspectives/europe/united-kingdom/uk-construction-market-view-spring-2026",
      "title": "UK Construction Market Outlook Spring 2026 - Arcadis",
      "content": "What is the forecast for UK construction inflation?\n\n  Construction cost inflation is expected to remain moderate in the near term due to soft demand and competitive pressure across supply chains. However, rising commodity and energy prices, labour shortages, and increased infrastructure investment could create renewed inflationary pressure as market activity strengthens.\n How will building costs change in 2026? [...] Recent increases in metals prices, particularly copper and aluminium, are expected to affect specialist components such as electrical systems, cladding, and transmission infrastructure. While price hedging and supply chain dynamics may delay some impacts, sustained commodity inflation could increase costs for complex building and infrastructure projects.\n What could be the effect of the 2026 Iran War?\n\n  The conflict in the Gulf Region is causing significant disruption to energy markets that will spill over into manufacturing supply chains. The Spring Market View forecast does not include a specific assessment of the impact of the War but includes a range of inflationary outcomes. [...] UK construction pipeline insights—where future workload is strengthening, and why housing continues to lag despite improving orders.\n\nUK building cost forecast and inflation pressures—the impact of labour markets, commodity volatility (including copper and aluminium), and competitive tender conditions.\n\nInfrastructure investment and mega-project progress—what RIS3, AMP8, defence, flood management, and major transport schemes mean for contractor capacity.\n\nRegional construction market trends—which UK regions are emerging as hot spots, and where pipeline momentum is beginning to recover.\n\n## What the latest UK construction forecast means for 2026",
      "score": 0.99961406,
      "raw_content": null
    },
    {
      "url": "https://publications.turnerandtownsend.com/global-construction-market-intelligence-2025/global-construction-cost-trends",
      "title": "Global construction cost trends - GCMI 2025",
      "content": "In developed regions, construction inflation rates continued normalising in 2024, as the effects of restrictive interest rates and softening demand filtered through the economy. The UK recorded an average increase of 3.0 percent, while Europe experienced average inflation of 2.9 percent. North America reported 3.6 percent, whereas Australia and New Zealand experienced a higher rate of 4.7 percent for the year, largely driven by a newly negotiated enterprise agreement introducing a payrise for construction labour, though this still marks an improvement compared to previous years. These figures indicate a return to escalation rates more aligned with those seen prior to the pandemic, suggesting greater stability in material pricing and project-related costs. [...] Global construction cost inflation rose by 4.15 percent in 2024, with significant variations between regions. While inflationary pressures moderated in developed economies, several developing markets experienced much stronger escalation due to economic instability, currency fluctuations and material cost volatility. [...] On the cost side, data centres also lead with the highest preliminary costs, reported in 20 markets. Transport projects follow with 10 markets, while industrial, manufacturing and distribution, along with major mixed-use developments, are each reported in nine markets. Greater certainty around energy supplies and the impact of tight monetary policy on global demand have also been pushing costs downwards. The average price of oil has fallen by 28.5 percent since its peak in June 2022 as production in the US and Iran has swelled.\n\n## Figure 3:\n\nTurner & Townsend, Global construction market intelligence 2025\n\n#### INFLATION\n\n## Global construction cost inflation across 2024, 2025 and 2026",
      "score": 0.9995827,
      "raw_content": null
    },
    {
      "url": "https://www.deloitte.com/us/en/insights/industry/engineering-and-construction/engineering-and-construction-industry-outlook.html",
      "title": "2026 Engineering and Construction Industry Outlook",
      "content": "Recent tariffs, especially on steel and aluminum, reaching up to 50%5—have sharply raised construction material costs.6 The effective tariff rate for construction goods climbed to a 40-year high of 25% to 30% in 2025.7 The financial impact is evident: Material prices have risen steadily from May through August 2025.8 [...] Copy  \n\nImage 25\n\nIn 2025, the engineering and construction industry’s early growth momentum was increasingly tested by emerging challenges as the year progressed: Real value added climbed to US$890 billion in the second quarter—a 1% increase year over year—while real gross output reached US$1.732 trillion, reflecting a 0.6% fall.1 By July, total construction spending declined almost 3% year over year, primarily driven by downturns in commercial (–8.2%) and manufacturing (–7%) construction (figure 1).2 At the same time, firms grappled with persistent inflation, elevated interest rates, tariff uncertainty, acute labor shortages, supply chain disruptions, and material price spikes, contributing to tightened margins and stretched schedules.",
      "score": 0.9995592,
      "raw_content": null
    },
    {
      "url": "https://www.ibisworld.com/united-kingdom/bed/construction-materials-price-index/44255/",
      "title": "Construction materials price index - Business Environment Profile Report | IBISWorld",
      "content": "Over the five-year period through 2024-25, the UK CMPI is forecast to increase at a compound annual rate of 6.2% - the equivalent of a +39.6-point absolute change - to reach 151.9 points. While being a marked increase in absolute terms, this is partly due to the CMPI starting from a relatively low base in 2017-18 (94.5 points); nevertheless, a subsequent sustained rise in the value of underlying construction activity consistently pushed up supply chain prices, while recent pandemic-induced supply chain disruption and resultant exponential price inflation has more recently exaggerated growth in the CMPI. [...] ## Recent Trends – Construction materials price index\n\nOver the five-year period through 2024-25, the UK CMPI is forecast to increase at a compound annual rate of 6.2% - the equivalent of a +39.6-point absolute change - to reach 151.9 points. While being a marked increase in absolute terms, this is partly due to the CMPI starting from a relatively low base in 2017-18 (94.5 points); nevertheless, a subsequent sustained rise in the value of underlying construction activity consistently pushed up supply chain prices, while recent pandemic-induced supply chain disruption and resultant exponential price inflation has more recently exaggerated growth in the CMPI. [...] In 2015-16, a 2.4% decline - -2.2 points in absolute terms - was in consequence of tumbling global commodity prices between 2014-2016, in particular crude oil, iron and steel, which naturally sent ripples through industrial sector supply chains. However, construction materials prices subsequently rallied, driven by a combination of a high level of UK construction activity and post-referendum exchange rate-driven input price inflation. Subsequent to, and consequent of, the EU referendum result, political and market uncertainties ensued and, in turn, currency and commodity market traders lost confidence in the UK economy; the trade-weighted value of the pound sterling depreciated sharply as a result, and since remained depressed against historical standards. In this respect, the price of",
      "score": 0.9991573,
      "raw_content": null
    },
    {
      "url": "https://www.bcis.co.uk/news/bcis-construction-industry-forecast/",
      "title": "BCIS construction industry forecast",
      "content": "### BCIS construction industry forecast – 1Q2026 to 1Q2031\n\nBuilding costs are forecast to increase by 14% over the next five years, while tender prices are expected to rise by 15% over the same period, according to BCIS’s latest construction forecast data.\n\nTotal new work output is forecast to grow by 12% between 2026 and 2031.\n\nDr David Crosthwaite, chief economist at BCIS, said: ‘Conditions in the UK construction sector at the start of 2026 were mixed, with some signs of improving sentiment before geopolitical developments unsettled energy markets and clouded the outlook.",
      "score": 0.99856746,
      "raw_content": null
    }
  ],
  "formatted": "Source: UK Construction Market Outlook Spring 2026 - Arcadis\nURL: https://www.arcadis.com/en-gb/insights/perspectives/europe/united-kingdom/uk-construction-market-view-spring-2026\nWhat is the forecast for UK construction inflation? Construction cost inflation is expected to remain moderate in the near term due to soft demand and competitive pressure across supply chains. However, rising commodity and energy prices, labour shortages, and increased infrastructure investment could create renewed inflationary pressure as market activity strengthens. How will building costs change in 2026? [...] Recent increases in metals prices, particularly copper and aluminium, are expected to affect specialist components such as electrical systems, cladding, and transmission infrastructure. While price hedging and supply chain dynamics may delay some impacts, sustained commodity inflation could increase costs for complex building and infrastructure projects. What could be the effect of the 2026 Iran War? The conflict in the Gulf Region is causing significant disruption to energy markets that will spill over into manufacturing supply chains. The Spring Market View forecast does not include a specific assessment of the impact of the War but includes a range of inflationary outcomes. [...] UK construction pipeline insights—where future workload is strengthening, and why housing continues to lag despite improving orders. UK building cost forecast and inflation pressures—the impact of labour markets, commodity volatility (including copper and aluminium), and competitive tender conditions. Infrastructure investment and mega-project progress—what RIS3, AMP8, defence, flood management, and major transport schemes mean for contractor capacity. Regional construction market trends—which UK regions are emerging as hot spots, and where pipeline momentum is beginning to recover. ## What the latest UK construction forecast means for 2026\n\n---\n\nSource: Global construction cost trends - GCMI 2025\nURL: https://publications.turnerandtownsend.com/global-construction-market-intelligence-2025/global-construction-cost-trends\nIn developed regions, construction inflation rates continued normalising in 2024, as the effects of restrictive interest rates and softening demand filtered through the economy. The UK recorded an average increase of 3.0 percent, while Europe experienced average inflation of 2.9 percent. North America reported 3.6 percent, whereas Australia and New Zealand experienced a higher rate of 4.7 percent for the year, largely driven by a newly negotiated enterprise agreement introducing a payrise for construction labour, though this still marks an improvement compared to previous years. These figures indicate a return to escalation rates more aligned with those seen prior to the pandemic, suggesting greater stability in material pricing and project-related costs. [...] Global construction cost inflation rose by 4.15 percent in 2024, with significant variations between regions. While inflationary pressures moderated in developed economies, several developing markets experienced much stronger escalation due to economic instability, currency fluctuations and material cost volatility. [...] On the cost side, data centres also lead with the highest preliminary costs, reported in 20 markets. Transport projects follow with 10 markets, while industrial, manufacturing and distribution, along with major mixed-use developments, are each reported in nine markets. Greater certainty around energy supplies and the impact of tight monetary policy on global demand have also been pushing costs downwards. The average price of oil has fallen by 28.5 percent since its peak in June 2022 as production in the US and Iran has swelled. ## Figure 3: Turner & Townsend, Global construction market intelligence 2025 #### INFLATION ## Global construction cost inflation across 2024, 2025 and 2026\n\n---\n\nSource: 2026 Engineering and Construction Industry Outlook\nURL: https://www.deloitte.com/us/en/insights/industry/engineering-and-construction/engineering-and-construction-industry-outlook.html\nRecent tariffs, especially on steel and aluminum, reaching up to 50%5—have sharply raised construction material costs.6 The effective tariff rate for construction goods climbed to a 40-year high of 25% to 30% in 2025.7 The financial impact is evident: Material prices have risen steadily from May through August 2025.8 [...] Copy Image 25 In 2025, the engineering and construction industry’s early growth momentum was increasingly tested by emerging challenges as the year progressed: Real value added climbed to US$890 billion in the second quarter—a 1% increase year over year—while real gross output reached US$1.732 trillion, reflecting a 0.6% fall.1 By July, total construction spending declined almost 3% year over year, primarily driven by downturns in commercial (–8.2%) and manufacturing (–7%) construction (figure 1).2 At the same time, firms grappled with persistent inflation, elevated interest rates, tariff uncertainty, acute labor shortages, supply chain disruptions, and material price spikes, contributing to tightened margins and stretched schedules.\n\n---\n\nSource: Construction materials price index - Business Environment Profile Report | IBISWorld\nURL: https://www.ibisworld.com/united-kingdom/bed/construction-materials-price-index/44255/\nOver the five-year period through 2024-25, the UK CMPI is forecast to increase at a compound annual rate of 6.2% - the equivalent of a +39.6-point absolute change - to reach 151.9 points. While being a marked increase in absolute terms, this is partly due to the CMPI starting from a relatively low base in 2017-18 (94.5 points); nevertheless, a subsequent sustained rise in the value of underlying construction activity consistently pushed up supply chain prices, while recent pandemic-induced supply chain disruption and resultant exponential price inflation has more recently exaggerated growth in the CMPI. [...] ## Recent Trends – Construction materials price index Over the five-year period through 2024-25, the UK CMPI is forecast to increase at a compound annual rate of 6.2% - the equivalent of a +39.6-point absolute change - to reach 151.9 points. While being a marked increase in absolute terms, this is partly due to the CMPI starting from a relatively low base in 2017-18 (94.5 points); nevertheless, a subsequent sustained rise in the value of underlying construction activity consistently pushed up supply chain prices, while recent pandemic-induced supply chain disruption and resultant exponential price inflation has more recently exaggerated growth in the CMPI. [...] In 2015-16, a 2.4% decline - -2.2 points in absolute terms - was in consequence of tumbling global commodity prices between 2014-2016, in particular crude oil, iron and steel, which naturally sent ripples through industrial sector supply chains. However, construction materials prices subsequently rallied, driven by a combination of a high level of UK construction activity and post-referendum exchange rate-driven input price inflation. Subsequent to, and consequent of, the EU referendum result, political and\n\n---\n\nSource: BCIS construction industry forecast\nURL: https://www.bcis.co.uk/news/bcis-construction-industry-forecast/\n### BCIS construction industry forecast – 1Q2026 to 1Q2031 Building costs are forecast to increase by 14% over the next five years, while tender prices are expected to rise by 15% over the same period, according to BCIS’s latest construction forecast data. Total new work output is forecast to grow by 12% between 2026 and 2031. Dr David Crosthwaite, chief economist at BCIS, said: ‘Conditions in the UK construction sector at the start of 2026 were mixed, with some signs of improving sentiment before geopolitical developments unsettled energy markets and clouded the outlook."
}