By Richard Cook, Head of Economics, Pegasus Group 

UK construction has bucked the trend again. For the third month in a row, construction output rose in April 2026, this time by 0.1 percent, proving the industry’s robustness in the face of both domestic and global instability.  

The main takeaways identified by the Office for National Statistics are as follows: 

  • Total construction output is estimated to have grown by 1.6% in the three months to April 2026; this is the second consecutive increase in the three-monthly series. 
  • Over the three-month period, both new work, and repair and maintenance, grew by 0.3% and 3.4%, respectively. 
  • At the sector level, six out of the nine sectors grew in the three months to April 2026; the main positive contributor to the increase was non-housing repair and maintenance, which grew by 3.5%. 
  • Monthly construction output is estimated to have grown by 0.1% in April 2026; this follows an increase of 1.5% in March 2026, and an increase of 0.5% in February 2026. 
  • The increase in monthly output in April 2026 came solely from an increase in repair and maintenance, which grew by 0.6%, while new work fell by 0.3%. 

This month’s figures are the first to seriously reflect the impact of the conflict in the Middle East, making the construction industry’s resilience in the context of a wider economy under pressure especially striking. While we can’t afford to be complacent – decreases could still be on the cards for future months – these figures provide a much-needed tonic to the doom and gloom that has otherwise dominated discussions in and around the sector. 

Problems do inevitably remain, as construction continues to grapple with high costs, mounting insolvencies, and chronic skills shortages. The mood amongst housebuilders remains cautious and many are cutting back on land acquisitions as a result. 

However, there are further positive developments on the horizon. The government’s response to the draft NPPF consultation is now anticipated ahead of the summer recess.  If effectively implemented, it should prove instrumental in speeding up the planning process and boosting delivery, which in turn, would make the government’s ambitious 1.5 million homes target more feasible. 

We are also hearing in direct conversations with councillors that local authorities are becoming increasingly aware of the very real viability pressures affecting new developments. If there was one clear message that came out of UKREiiF this year, it was that many councils are keen on working more collaboratively with developers to do things differently and unlock development. 

It is also worth bearing in mind that despite the viability challenges present in markets like residential development, there is shortage of strong capital appetite to fund schemes. Where investors can get stuck, however, is in turning that capital into actionable delivery. Planning is frequently seen as a complex, uncertain barrier to development, and this is where having a partner to demystify the system can help de-risk schemes.  

Furthermore, the recent announcement of £96 million to fund regional placements for aspiring construction workers is equally welcome, and a much-needed step towards plugging the skills gap in the sector. Although it will take time for this new generation to reach the construction labour pool, the challenging graduate jobs market and the industry’s immunity against job losses to AI make it increasingly attractive to the workforce. 

Compared to some of our European neighbours, the UK is weathering the effects of global instability relatively well. Unemployment may be at 5% in the UK, but it is over 8% in France, where the threat of a recession is mounting. Building on the green shoots shown in these figures, housebuilders now need to get their applications in the planning system. If the construction industry can lead the way and deliver, this could offer a transformative boost to the wider economy. 

If you’d like to discuss how Pegasus can support your development, get in touch with Richard Cook.