Reasons to be cheerful for construction sector despite dip in activity, says MHA advisor

By MHA

08 Jan 2025

Website
Joe Sullivan_MHA_small.jpg.jpg

The construction sector is poised for slow and steady growth in 2025 despite a fall in activity towards the end of 2024, according to a leading Lancashire-based sector advisor.

Joe Sullivan, partner and construction specialist at accountancy and business advisory firm MHA, was commenting after the release of the S&P Global Construction PMI (purchasing manager’s index) data for December 2024.

Construction output growth eased to a six-month low in December according to the PMI data, but business optimism rebounded from the 13-month low seen in the previous month.

Joe, who advises construction and real estate businesses across the region, said: “The fall in construction PMI is hardly surprising as while the industry continues to benefit from the government's investment in infrastructure, it is hampered by still historically high interest rates and an uptick in employment costs.

“Activity in the commercial sector remains strong, but housing has dipped. Whether the housing market will see a reversal in fortunes this year remains to be seen, however the opportunity to develop is clearly there given the planning reforms included in the recent NPPF.

“Overall, the construction industry has been relatively resilient in 2024 compared to other industrial sectors. Demand for construction is very much on a domestic level, whereas manufacturing and other industrial sectors are reliant on the global economy.”

Joe added: “From what our clients are telling us, 2025 is expected to be better than last year; however, it’ll be a slow burn. Infrastructure will do well given the government’s investment plans as will commercial as the UK is becoming an investment choice for many. Housing supply will be available but it’s whether demand will follow if interest rates remain stubbornly high.

“While high interest rates and increasing labour costs will continue to have an impact on the industry, an increased flow of inward investment should provide some relief.

“We expect that construction PMI will hover around the same level as it is currently for much of 2025, and any spikes are likely to be short-lived. Although growth will be slow and steady, the fundamentals for the sector are solid and there is an air of quiet optimism.”

The S&P Global UK Construction PMI is compiled by S&P Global from responses to questionnaires sent to a panel of around 150 UK construction companies.

Enjoyed this? Read more from MHA

Latest news

1

Final call for investors: Rossendale community solar project must hit target by November Gary McEwan managing director of Interfloor

Final call for investors: Rossendale community solar project must hit target by November

10 Sep 2025

2

Lancashire Combined County Authority unveil plan to Get Lancashire Working Lancashire Combined Authority

Lancashire Combined County Authority unveil plan to Get Lancashire Working

10 Sep 2025

3

Lockheed Martin Skunk Works and BAE Systems’ FalconWorks announce strategic collaboration Collaboration between BAE Systems FalconWorks and Lockheed Martin Skunk Works

Lockheed Martin Skunk Works and BAE Systems’ FalconWorks announce strategic collaboration

09 Sep 2025

4

High street retailers urged to ‘take advantage’ of new funded support programme Brian Moore, Lee Johnson, Anne Williamson and Andrew Leeming

High street retailers urged to ‘take advantage’ of new funded support programme

08 Sep 2025

5

Beaverbrooks invest in the high street in difficult conditions Mark Adlestone And Anna Blackburn Beaverbrooks

Beaverbrooks invest in the high street in difficult conditions

08 Sep 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
Sub36 Networking - Follow the signs
Sub36 Deaf Village Social1200
Networking
17 Sep 2025

Sub36 Networking - Follow the signs

The Deaf Village, Blackburn, BB2 5EN

10:00 - 12:00

LBV124 September/October Launch Event
MBP Arc Cinema Preston Opening 205
Networking
18 Sep 2025

LBV124 September/October Launch Event

The Arc Cinema, Preston, PR1 2BL

08:30 - 10:30

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Longridge Soap Box Derby
Screenshot 2025-06-10 090035.png.png
LBV Hub Fundraisers
14 Sep 2025 - 14 Sep 2025

Longridge Soap Box Derby

Berry Lane, Longridge, PR3 3WH

10:00 - 16:30

Preston Tech Connection - The Ultimate Tech Quiz!
Preston Tech Connection Sept 25.png.png
LBV Hub Networking
16 Sep 2025 - 16 Sep 2025

Preston Tech Connection - The Ultimate Tech Quiz!

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:00

The Business Network Central & East Lancashire
LBV Hub Networking
17 Sep 2025 - 17 Sep 2025

The Business Network Central & East Lancashire

Stanley House, Blackburn, BB2 7NP

11:30 - 14:15

Cumbria Business Expo 2025
https---cdn.evbuc.com-images-880461633-4862066883-1-original.20241022-110415.jpeg.jpg
LBV Hub Exhibitions
19 Sep 2025 - 19 Sep 2025

Cumbria Business Expo 2025

Carlisle Racecourse, Carlisle, CA2 4TS

09:00 - 15:00

Preston Freelancer Meet-Up: September
Sept Freelancer (1).png.png
LBV Hub Networking
23 Sep 2025 - 23 Sep 2025

Preston Freelancer Meet-Up: September

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Your Business, Your Region: Making sense of devolution and Local Government Reorganisation
Chorley Council breakfast event new
LBV Hub Networking
23 Sep 2025 - 23 Sep 2025

Your Business, Your Region: Making sense of devolution and Local Government Reorganisation

Worden Hall, Leyland, PR25 3DH

08:00 - 11:00

Speed Networking with BNI
2.png.png
LBV Hub Networking
24 Sep 2025 - 24 Sep 2025

Speed Networking with BNI

Chorley Football Club, Chorley, PR7 3DU

16:00 - 19:00

The Marketing Meetup IRL: Lancashire - September
TMM Lancashire
LBV Hub Networking
25 Sep 2025 - 25 Sep 2025

The Marketing Meetup IRL: Lancashire - September

Chorley, PR7 2SL

18:00 - 20:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV 123 Online Graphic
Subscribe now

Weekly news bulletin