Monthly construction output nudged upwards 0.1% during July, latest Office for National Statistics figures have shown.

Coming on the back of a 0.1% decrease in June and a decrease of 0.8% in May, industry has warned it’s “too soon” to see the rise as a sign of sustained recovery.

The increase in monthly output in July came solely from an increase in repair and maintenance, which grew by 0.8%, while new work fell by 0.4%. The main contribution to the monthly increase in repair and maintenance was private housing repair and maintenance, which grew by 1.7%, while the largest contribution to the decrease in total new work was a fall of 4.9% in private housing new work.

Total construction output is estimated to have fallen by 0.5% in the three months to July -  this follows four consecutive increases in the three-monthly series, with strong growth seen in the three months to April and May, of 1.3% and 1.5%, respectively.

Over the three-month period, both new work, and repair and maintenance, fell, by 0.4% and 0.7%, respectively.

At the sector level, six out of the nine sectors fell in the three months to July 2026; the main negative contribution to the decrease was private housing repair and maintenance, which fell by 1.7%.

Jo Streeten, managing director, Buildings & Places at AECOM, said: “A return to growth is a welcome sign that conditions are beginning to improve, particularly after a three-month run of falling output. But despite today’s data it’s too soon to suggest there is a sustained recovery. Clients remain cautious about committing to new projects amid higher financing costs and wider economic uncertainty.

“If those pressures begin to ease, there’s reason for contractors to feel confident about opportunities ahead. While softer demand remains a challenge for the sector, it has created greater capacity and competition for work, helping to keep tender price pressures in check and creating a more favourable environment for clients ready to bring projects forward.

“Recent planning reforms should help too. The test now is how quickly these conditions translate into projects getting under way. If they do, contractors will have the confidence to build capacity and invest in skills.”

Latest data from Glenigan has also shown that the construction recovery has yet to materialise despite, non-residential growth. Its September 2026 Construction Index focuses on the three months to the end of August 2026, covering all underlying projects, with a total value of £100m or less (unless otherwise indicated), with all figures seasonally adjusted. 

The report shows the construction industry continues to stall against a backdrop of ongoing economic uncertainty, stubborn borrowing costs and lingering investor caution. However, despite poor year-on-year performance with project starts down 20% compared to 2025, results held relatively steady against the preceding three months, only dipping 2%.

Glenigan’s Allan Willen says: “After a rough start to the year, it's fair to say the sector caught its breath over the summer and, whilst activity levels remain painfully low, they have stabilised. It’s a positive sign that the freefall, which began in Q2 has finally ground to a halt; That said, we're not exactly climbing yet.”