Latest civil engineering tender price movement

Civil engineering tender prices rise amid capacity challenges

Civil engineering tender prices rose by an estimated 0.5% between 3Q2025 and 4Q2025, according to the latest update from the BCIS Civil Engineering TPI panel⁽¹⁾.

This represents a 3.6% change in the year to 4Q2025.

Panellists reported a relatively stable pipeline in the fourth quarter with activity in the nuclear subsector moving at a particularly fast pace.

This is due to progress on Hinkley Point C, Sizewell C and several small modular reactor projects.

Aviation is also seeing more projects entering the pipeline although panellists cautioned that labour capacity and capability may become strained when these projects land.

Dr David Crosthwaite, chief economist at BCIS, said: ‘Capacity issues were the defining trend for infrastructure in the fourth quarter. For example, panellists noted transmission owners are reporting up to a ten-year wait on the installation of cables and transmission stations in some cases. The wider sector is also losing more of its junior workers to international markets and with them, opportunities to sure up the next generation of talent.’

Direct employment hasn’t increased; panellists noted that a large proportion of work is still undertaken by subcontractors and that securing and maintaining labour is difficult where better incentives (i.e. high-quality, on-site facilities) are offered by competitors.

A lack of negotiation experience, specifically supporting negotiation between tier one contractors and clients, was identified as a particular skills gap. The panel said this capability has been vanishing since the pandemic.

Elsewhere, panellists underlined the absorption of domestic work by European and other international contractors as a further challenge. It was noted that in certain cases, domestic contractors don’t have the same level of experience delivering large, complex projects, such as multi-billion-pound nuclear power generation.

‘The immediate challenge for infrastructure moving forward will be getting the right skills in the right places. On a project level, panellists said setting up an incentivisation model in the right way is key as this will attract the right people who can deliver the right outcomes,’ Dr Crosthwaite added.

‘On a wider level, reliable cost forecasting, robust planning and collaboration as ever are essential and the best tools for businesses to handle the cost implications of an increasingly competitive market.’

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^{(1) The panel, comprised of cost consultants from firms involved in multiple civil engineering tenders in the UK, advises on the latest movement in tender prices, i.e. prices agreed between client and constructor at commit to construct, as well as providing commentary on conditions affecting pricing levels. This insight helps to inform quarterly updates to the BCIS Civil Engineering Tender Price Index.}