2022
9
UK Construction Market Report 2022
2022-04-23T04:06:18+01:00
OX1101835
1495
150717
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Report
en_GB
“The construction market, covering a variety of end use markets, has shown major variation in demand firstly with Brexit and then COVID-19. Extreme changes in demand were seen in for…

UK Construction Market Report 2022

£ 1,495 (Excl.Tax)

Description

Unlock the potential of the UK Construction Market with our comprehensive report. Our analysis examines the growth of the UK construction market following the initial impact of the pandemic, the demand and supply imbalance within the housing constitution sector and the impact of rising inflation on the wider construction market. You’ll gain invaluable insight into the UK construction market size, as well as market projections, segmentation, and the latest trends in the UK construction market.

UK Construction Market Overview & Size

Inflation is rising rapidly in 2022 will extend the magnitude and length of the inflationary period bringing a very different dynamic to the UK construction market with private housing RMI likely to be the most significantly impacted. Private housing RMI is moderating after a very strong 2021 when the market conditions were favourable and pent-up demand existed. However, the UK construction market will now suffer from the increased financial demands on households, businesses and government budgets.

Understand the UK Construction Market Trends & Businesses’ Attitudes

Mintel’s construction market analysis reveals how the construction market size is a reflection of both consumer and business confidence, which makes the sector a leading indicator of the wider economy. Business confidence manifests itself in the form of speculative construction. When the economy shrinks, there are calls for such speculative construction to be removed from the UK construction market, but they constantly re-emerge as the economy improves.

The UK construction market is also impacted by government policy, while health and education have been identified as specific areas of investment by the government, this will not be fully reflected in construction output, although a 10-year plan has now been identified for the education sector.

  • UK construction market size: The market experienced strong growth in 2021/22 achieving £138 billion in 2022. Despite this recovery, the value of the market is below the levels achieved in
  • UK construction market share: 63% of the UK construction market share -excluding infrastructure- is accounted for by new construction.
  • UK construction market challenges: The UK has a backlog of 3.91 million homes – meaning that 340,000 new homes need to be built each year until 2031. The shortfall continues to grow each year.

Unlock Future Opportunities in the UK Construction Market

In the longer term, the housing shortage will continue to be a major market driver. RMI activity, including investment in thermal insulation, can be expected to improve after the difficulties associated with inflation.

Digitisation continues to increase across virtually every business area and extends into consumer activities, which was significantly furthered by the pandemic. Mintel’s construction market analysis indicates that this creates a major investment area for data centres, where demand continues to grow for new construction and refit of existing facilities. Repurposing of existing retail and office buildings is also providing a short term boost to fit out projects.

To discover more about the UK Construction Market Report 2022, read our UK Mechanical and Electrical Engineering Market Report 2022, or take a look at our other Industrial Market Research.

Quickly Understand

  • How the different construction sectors have fared during the pandemic and those facing longer-term issues from COVID-19, particularly in the commercial construction sector.
  • Why the housing construction levels are failing to address the demand and supply imbalance.
  • How the industrial UK construction market has shifted in favour of warehousing with Brexit and technology changing the market dynamics.
  • How the housing RMI showed remarkable growth following the initial impact of the pandemic but is now challenged by surging inflation.
  • Why the industry structure is so unusual in the UK construction market with significant SME activity.
  • Explores UK construction market size, share and segmentation.

Covered in this Report

Brands: Barratt Developments, Galliford Try, Kier Group, Morgan Sindall, Persimmon, Taylor Wimpey.
Products:
Publicly and privately financed construction projects.

Expert Analysis from a Specialist in the B2B Sector

This report, written by Terry Leggett, a leading analyst in the B2B sector, delivers in-depth commentary and analysis to highlight current trends in the UK construction market and add expert context to the numbers.

The construction market, covering a variety of end use markets, has shown major variation in demand firstly with Brexit and then COVID-19. Extreme changes in demand were seen in for example the private housing RMI sector during the pandemic but the buoyancy of demand in 2020 is now strongly challenged by the fuel cost inflation pressure. New housing continues to grow but there are sectors of commercial construction facing long-term challenges, which contrastingly is tending to favour RMI activity.”

Terry Leggett - Senior Analyst

Terry Leggett
Senior Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • Market context
    • Products covered in this Report
  2. Executive Summary

    • The five-year outlook for construction
      • Figure 1: Construction outlook, 2022-27
    • The market
    • A partial recovery in 2021, but changing circumstances
      • Figure 2: Market size for construction, 2016-26
    • New construction
      • Figure 3: Segmentation of new construction, 2021 (£ million)
    • RMI
      • Figure 4: Segmentation of RMI construction activity, 2021 (£ million)
    • Market drivers
    • Companies and brands
    • A large and growing industry
      • Figure 5: Number of companies active in construction, 2015-20
    • An unusual structure
      • Figure 6: Revenue segmentation in construction, by size of company, 2021
      • Figure 7: Segmentation of major trades, 2020 (number of companies)
    • Separate areas of focus
      • Figure 8: Composition of main trades contractors, 2020 (number of companies)
  3. Issues and Insights

    • 2022 changing the product mix
    • Ever improving conditions for modern methods of construction
  4. Market Size and Performance

    • Major COVID-19 disruption
      • Figure 9: Market size for construction, 2016-21
    • New construction
      • Figure 10: Market size for new construction, 2016-21 (£ million)
    • RMI
      • Figure 11: Market size for RMI construction, 2016-21 (£ million)
  5. Market Forecast

    • Mixed prospects
      • Figure 12: Construction outlook, 2022-27
    • Growth to be led by new construction
      • Figure 13: Market forecast for construction, 2021-26
      • Figure 14: Market forecast for new construction, 2021-26
      • Figure 15: Market forecast for RMI construction, 2021-26
    • Market drivers and assumptions
      • Figure 16: Key drivers affecting Mintel’s market forecast, 2016-26
    • Forecast methodology
  6. Market Segmentation

    • Diverse influences
      • Figure 17: Segmentation of new construction activity, 2021 (£ million)
      • Figure 18: Segmentation of RMI construction activity, 2021 (£ million)
  7. Segmentation: New Housing

    • The context
      • Figure 19: Housing completions in England, by sector, 1978-2021
    • Construction activity disrupted
      • Figure 20: The new housebuilding market, 2016-21
      • Figure 21: Segmentation of the new housebuilding market, 2016-21
    • Market prospects
      • Figure 22: Forecast for new housebuilding market, 2022-26
  8. Segmentation: New Private Commercial

    • A market susceptible to recessions
      • Figure 23: Long term development of commercial construction, 1970-2021
    • Construction activity and prospects
      • Figure 24: The new commercial construction market, 2016-21
      • Figure 25: Segmentation of commercial construction market, 2016-21 (£ million)
      • Figure 26: Forecast for commercial construction market, 2022-26
  9. Segmentation: New Private Industrial

    • The context
      • Figure 27: Long term development of industrial construction, 1970-2021
    • Construction activity and prospects
      • Figure 28: The new industrial construction market, 2016-21
      • Figure 29: Segmentation of industrial construction, 2016-21
      • Figure 30: Forecast for industrial construction market, 2022-26
  10. Segmentation: New Public Non-residential

    • Government policy determines trends
      • Figure 31: Long term development of public non-residential construction, 1970-2021
    • Construction activity
      • Figure 32: The new public non-residential construction market, 2016-21
      • Figure 33: Segmentation of public non-residential construction, 2016-21
      • Figure 34: Department of Health and Social Care spending 2015-25
      • Figure 35: Forecast for public non-residential construction market, 2022-26
  11. Segmentation: RMI Housing

    • Strong COVID-19 impact
      • Figure 36: The housing RMI construction market, 2016-21
    • Private housing
      • Figure 37: Average UK house prices, 2016-21
      • Figure 38: The private housing RMI construction market, 2016-21
      • Figure 39: Forecast for private housing RMI construction market, 2022-26
    • Public housing
      • Figure 40: The public housing RMI construction market, 2016-21
      • Figure 41: Forecast for public Housing RMI construction market, 2022-26
  12. Segmentation: RMI Private Non-residential

      • Figure 42: The private non-residential RMI construction market, 2016-21
      • Figure 43: Forecast for private non-residential RMI construction market, 2022-26
  13. Segmentation: RMI public non-residential

      • Figure 44: The public non-residential RMI construction market, 2016-21
      • Figure 45: School capital funding, 2015-23 (£ million)
      • Figure 46: Forecast for public non-residential RMI construction market, 2022-26
  14. Market Drivers

    • The relationship with the economic environment
      • Figure 47: Comparison of UK GDP and construction output changes, 2017-21
    • The conflict in Ukraine will hurt the UK economy
    • GDP reached pre-pandemic levels in November 2021 …
    • … but the post-COVID-19 bounce back will be followed by a period of slower growth
    • Employment has held up better than expected
    • Inflation is the key concern for 2022 for consumers, brands and the economy
  15. Industry Structure

    • A large and growing industry
      • Figure 48: Number of companies active in construction, 2015-20
    • The industry composition
      • Figure 49: Composition of main trades contractors, 2020 (number of companies)
      • Figure 50: Segmentation of major trades, 2020 (number of companies)
    • Analysis by turnover
    • Total construction
      • Figure 51: Revenue segmentation in construction, by size of company, 2021
    • New construction
    • Public housebuilding activity
      • Figure 52: Revenue segmentation in new public housebuilding, by size of company, 2021
    • Private housebuilding activity
      • Figure 53: Revenue segmentation in new private housebuilding, by size of company, 2021
    • Private commercial activity
      • Figure 54: Revenue segmentation in new private commercial construction, by size of company, 2021
    • Private industrial activity
      • Figure 55: Revenue segmentation in new private industrial construction, by size of company, 2021
    • Public non-residential activity
      • Figure 56: Revenue segmentation in new public non-residential construction, by size of company, 2021
    • Analysis by turnover – repair, maintenance and improvement
    • Public housing
      • Figure 57: Revenue segmentation in public housing RMI, by size of company, 2021
    • Private housing
      • Figure 58: Revenue segmentation in private housing RMI, by size of company, 2021
    • Private non-residential
      • Figure 59: Revenue segmentation in private non-residential RMI, by size of company, 2021
    • Public non-residential
      • Figure 60: Revenue segmentation in public non-residential RMI, by size of company, 2021
  16. Company Profiles

    • Barratt Developments
    • Activity
    • Performance
      • Figure 61: Financial performance of Barratt Developments, 2017-21 (£ million)
      • Figure 62: House completions by Barratt Developments, by region, 2019-21
      • Figure 63: Weekly equivalent unit builds by Barratt Developments, by FY quarter 2019-22
      • Figure 64: House completions by Barratt Developments, by unit type, 2020 and 2021
      • Figure 65: House completions by Barrett Developments, by deal type, 2020 and 2021
    • Strategy
    • Galliford Try
    • Activity
    • Performance
      • Figure 66: Financial performance of Galliford Try, 2017-21 (£ million)
      • Figure 67: Segmentation of Galliford Try construction based forward orders, 2021 (£ million)
    • Strategy
    • Kier Group
    • Activity
    • Performance
      • Figure 68: Financial performance of Kier Group, 2017-21 (£ million)
    • Strategy
    • Morgan Sindall
    • Activity
    • Performance
      • Figure 69: Financial performance of Morgan Sindall Group, 2017-21 (£ million)
      • Figure 70: Revenue segmentation of Morgan Sindall Group, 2021 (£ million)
    • Strategy
    • Persimmon
    • Activity
    • Performance
      • Figure 71: Financial performance of Persimmon, 2017-21 (£ million)
    • Strategy
    • Taylor Wimpey
    • Activity
    • Performance
      • Figure 72: Financial performance of Taylor Wimpey, 2017-21 (£ million)
    • Strategy
  17. Appendix – Data Sources, Abbreviations and Supporting Information

  18. Appendix: Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 73: Forecast market for construction, 2021-26 (£ million)
    • Market drivers and assumptions

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

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