One of the highlights of our recent away day at Mercedes-Benz World was a keynote talk from Allan Wilén, Glenigan’s Economics Director. He walked us through the Glenigan Summer 2026-2028 Construction Industry Forecast for the UK, and the headline he delivered is one that UK built environment has been waiting for – growth is returning.
After a soft 2026, Glenigan expects UK construction to rebound.
The numbers tell the story – overall, there will be a slight dip of 1% this year, then an 11% jump in 2027, followed by 4% consolidating growth in 2028. Across the three years, that’s a 13% recovery on 2025 levels.
This growth won’t land evenly, however. Some sectors will move early, while others will build through 2027 and 2028.
Which UK construction sectors are set for growth?
Here’s how Allan Wilén explained it all:
- Industrial
Down 9% in 2026, but set for a sharp turnaround, up 16% in 2027 and 5% in 2028. Firm logistics demand and Government planning support are doing the heavy lifting.
- Offices
A 21% lift by the end of 2026, then a correction of 11% in 2027 after that rapid growth, followed by 4% claw back in 2028. The appetite for high-quality, sustainable workspaces is strong, and AI is fuelling a wave of data centre demand.
- Education
Climbing 8% this year, 20% in 2027 and 5% in 2028. The School Building Programme and a clearer funding pipeline are unlocking work to replace tired, crumbling stock.
- Health
Steady and rising: 9% in 2026, 9% in 2027 and 14% in 2028. The New Hospital Programme and extra capital funding are helping the NHS chip away at a big repair backlog.
- Civil engineering
Flat in 2026, then a 15% surge in 2027 before levelling off in 2028. Behind that activity sits Ofwat’s £104bn water investment, renewables like offshore wind, Hinkley Point C and Sizewell C, plus transport work including HS2 and the TransPennine Route.
- Retail
Up 1% in 2026 and 10% in 2027, before a 4% dip in 2028. Higher wages and taxes are holding the retail sector back for now, but rising consumer spending and supermarket activity should help it recover.
- Hotels and leisure
This sector gives us the toughest near-term picture: down 12% in 2026, up 11% in 2027, then a slight 1% dip in 2028. Cost pressures and global instability are throttling investment, though lower business rates should help unlock its potential.
As Allan said, “There are some particularly exciting growth areas as Government funding is released and investor appetite starts to return to the market.” His message to contractors was blunt, “There will be no time for hanging around and the quicker the sector’s reaction, the sooner momentum will return and stick.”
So, what does this mean for supply chain payments?
Here’s the bit that matters to anyone managing applications for payment. When project starts pick up quickly, more applications flow through the supply chain, often under tighter deadlines. That’s when fragmented or manual payment processes start to creak.
Of course, growth is welcome news. But it puts pressure on cashflow and visibility across every tier of a project. The businesses that sort out their payment process now will be ready to move fast when the work arrives, rather than scrambling to keep up.
It’s a point one of our customers made recently: getting payment right protects you from regulatory exposure and frees up commercial teams to focus on the work that actually reduces costs. It’s also a source of reputational advantage, which helps cement your standing as a reliable partner.
Want the full picture?
Glenigan’s Summer 2026-2028 Construction Forecast has the detail. And if you’d like to see how Payapps keeps you on top of every application for payment as the market picks up, we’d be happy to show you.
