Construction costs globally are set to rise by 2.4% in 2026, but growing uncertainty is the real challenge to project delivery.

The findings are captured in Construction in 2026: Where Certainty Comes from Agility’, a new report published by Currie & Brown, provider of cost management, project management and advisory services.

At 3.6%, the UK sits in the middle of the global range of forecast cost escalation for 2026. Public investment across multiple sectors is supporting activity, but progress is slow.

High interest rates and weak growth are limiting confidence. Demand exists, but many projects are finely balanced. As a result, development is cautious and often phased in stages rather than fully committed from the start.

Nick Gray, chief operating officer, UK and Europe at Currie & Brown, said: “Cost increases in the UK remain moderate, but uncertainty is holding the market back. Many projects are only just viable, so development is moving carefully, often step by step.

“The Autumn Budget did little to shift that trajectory. It fell short for construction, offering no new tax incentives, increasing pressure through wage and tax changes, and providing scant detail on housing or digital infrastructure investment.

“In this environment, agility is essential. The ability to adapt quickly helps teams respond sooner, make firmer decisions, and avoid delays before they become costly.”

Globally in most countries, construction costs are forecast to rise between 2% and 6%, supported by steady demand across infrastructure, healthcare, technology and industrial sectors.

A small number of markets sit outside this range. In China, costs are expected to remain flat. This has weighted down the global average. In Japan, escalation could reach 10% to 12%, due to labour shortages and material pressures. These outliers highlight how local market conditions can impact costs.

But moderate cost growth does not mean a simple delivery environment. Labour shortages, shifting trade tariffs, supply chain disruption, energy price volatility, climate events, conflict and policy change are all affecting construction markets.

Click here to read the full report.