Total construction output has grown by 0.4% in the first quarter of the year, compared to the previous quarter, the latest figures from the Office for National Statistics (ONS) reveals.
Data shows repair and maintenance grew by 3.4%, while new work fell by 1.9%.
At the sector level, four out of the nine sectors grew in Q1 of the year. The main positive contributor to the increase was private housing repair and maintenance, which grew by 4.1%.
Monthly construction output is estimated to have grown by 1.5% in March 2026, this follows an increase of 0.5% in February 2026, and an increase of 0.7% in January 2026.
The increase in monthly output in March 2026 came from increases in both new work and repair and maintenance, which grew by 2.0% and 0.8%, respectively.
Total construction new orders fell by 10.5% (£1,238 million) in the first three months of the year compared to Q4 2025.
This quarterly decrease came mainly from private commercial new work and infrastructure new work.
The annual rate of construction output price growth was 0.8% in the 12 months to March 2026.
Pegasus Group senior economics director Richard Cook says: “We’ve now had a second month of rising construction outputs, which is a welcome sign that things may now be looking up for housebuilders after months of tough market conditions.”
“While the headline figure is clearly a positive step in the right direction, it obscures underlying challenges that housebuilders must remain mindful of. The ongoing conflict in the Middle East is having a damaging effect on the UK economy which isn’t yet reflected in these figures.”
“Economic forecaster ‘The ITEM Club’ has estimated the UK will lose 163,000 jobs this year, 32,500 of which will be in the construction sector – a substantial hit to a sector already struggling with skills shortages.”
“However, for now, rising construction output is a good sign that the UK construction sector can return to health in the long-term. The NPPF remains a beacon of hope for the housebuilders looking to deliver UK growth. Businesses will be looking to the final guidance, which is expected this summer, on how the planning process can be streamlined to minimise friction.”
Meanwhile, McBains managing director Clive Docwra adds: “Following growth in February exceeding expectations, March’s return will give further heart to the industry.”
“Overall growth of 1.5% in March is much better than expected given that these figures cover the first full month after the outbreak of the Iran war, while new work such as private housing increasing by 2.8% and commercial orders by 3.4% during the month are particularly pleasing.”
“However, the sector will be sounding a note of caution as factors such as continued unpredictability in the Middle East and rising inflation will continue to have an impact in terms of sluggish demand over the coming months.”
“The current uncertainty around the PMs position may also worry some investors in terms of whether a leadership change could result in policy shifts.”
“Even the recent local election results could also have a bearing on projects going ahead – as witnessed by reports that the new local council in Enfield may shelve plans for the shortlisted new town.”
