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Published: 02/10/2025
BCIS produces five-year construction industry forecasts, covering projected input costs, tender prices and output, and examining the latest construction market trends.
The quarterly BCIS infrastructure briefing is a civil engineering market report and presents our view of water and sewerage, electricity, roads, railways, harbours and flood defences, gas, air and communications, and infrastructure repair and maintenance output against a backdrop of civil engineering costs, including labour and materials, and the wider economic background.
The full briefing is available to subscribers of BCIS CapX.
BCIS infrastructure forecast – 2Q2025 to 2Q2030
Civil engineering costs are forecast to rise by 15% over the next five years to 2Q2030, while tender prices for civil engineering work are expected to increase by 24% over the same period, according to our latest data.
Dr David Crosthwaite, chief economist at BCIS, said: ‘Growth in civil engineering costs is primarily driven by labour costs, rather than materials cost inflation, with increases to National Insurance Contributions and the National Living Wage in the second quarter of this year impacting wage bills. Materials cost growth, conversely, is set to remain relatively flat this year.’
Despite a raft of announcements from the government over the summer and publication of both its 10-year strategy and infrastructure pipeline, the positive sentiment is yet to be translated into significantly increased activity levels. After new work infrastructure output decreased by 9.2% in 2024, BCIS is forecasting growth of 2.5% in 2025, and for an 18% increase overall between 2025 and 2030.
Dr Crosthwaite said: ‘Infrastructure spending has traditionally acted as a counter-cyclical support for construction, keeping work going when private investment falls. But with government finances squeezed by higher borrowing costs and weaker tax receipts, we’re now seeing the risk of delays, cutbacks or cancellations to planned projects.
‘Private investors are also adopting a “wait and see” approach, holding back decisions in the hope that successive announcements will provide more clarity and that financial conditions become more favourable. This fiscal ambiguity is stalling pipelines and delaying tendering, even where demand exists, leaving policymakers with the challenge of maintaining discipline while keeping a steady flow of projects to stimulate growth.’
The full details of the forecast are available in BCIS CapX.
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Quarterly updates to forecasts are published for infrastructure, building, and maintenance, cleaning and energy, while an annual update is published for the economic significance of maintenance.
