The Glenigan Construction Industry Forecast 2026–2028 makes one trend unmistakably clear: the UK’s infrastructure sector is heading into a period of accelerated growth. Civil engineering, utilities, transport and energy projects are all expected to expand throughout 2027, driven by regulatory investment cycles, public funding commitments and the urgent need to modernise national networks. For Tier 1 contractors, this shift represents both an opportunity and a challenge. The organisations that enter this new cycle with strong project cost management capabilities will be the ones best positioned to protect margins, manage risk and outperform their competitors.
The forecast shows that 2026 will be a year of subdued activity.
Major programmes have been paused or rephased, approvals have slowed, and several large schemes have been pushed into later years. Glenigan notes that “activity is expected to stabilise in 2026 before returning to growth in 2027,” creating a rare moment of operational breathing room. This quieter period offers contractors a strategic window to strengthen their commercial foundations—particularly in the area of project cost management.
That preparation is essential because the scale of the coming upswing is significant. Civil engineering starts are forecast to rise by 15% in 2027, with utilities leading the recovery. Ofwat’s £104 billion investment programme for 2025–2030 will drive unprecedented levels of water infrastructure renewal, while electricity generation and transmission upgrades will accelerate to support net‑zero commitments. Transport infrastructure will also gather pace, with road maintenance uplift, rail upgrades, HS2 progression and the TransPennine Route Upgrade all moving forward. Energy and renewables—offshore wind, nuclear, battery storage and grid‑scale solar—will return to momentum after a period of delay.
This surge in 2027 will bring increased commercial pressure.
Infrastructure projects are becoming more complex, more regulated and more sensitive to cost escalation. Contractors will face tighter margins, more demanding reporting obligations and greater scrutiny from clients, regulators and joint‑venture partners. In this environment, traditional cost‑tracking methods – spreadsheet‑based reporting, fragmented data, delayed visibility – are no longer sufficient.
Modern project cost management systems change the equation.
They provide real‑time visibility of cost performance across every stage of delivery, enabling commercial teams to track actuals against budget, monitor margin erosion and identify emerging risks before they escalate. Instead of discovering cost issues weeks or months after they occur, contractors gain the ability to react immediately – adjusting resources, renegotiating packages, addressing delays or resolving supply‑chain issues while there is still time to protect margin.
This capability becomes especially important in utilities and transport, where multi‑year frameworks, complex subcontractor ecosystems and regulatory reporting requirements create significant commercial exposure. Real‑time cost tracking allows contractors to maintain control over large, distributed delivery programmes, ensuring that commercial performance remains visible and manageable even as project volumes increase.
Margin protection is another critical advantage.
As Glenigan highlights, elevated build costs and financing constraints continue to affect project viability. Contractors handling the 2027 surge with strong cost‑management capabilities will be able to safeguard profitability by identifying margin threats early, rather than absorbing them late in the delivery cycle. This proactive approach to commercial management is becoming a defining characteristic of high‑performing infrastructure organisations.
The benefits extend beyond risk mitigation.
Accurate, real‑time cost data strengthens decision‑making, improves forecasting and enhances bid competitiveness. Contractors can price work more confidently, mobilise more effectively and demonstrate greater commercial transparency to clients – an increasingly important factor in winning major frameworks. In a market where digital maturity is becoming a pre‑qualification requirement, advanced cost‑management capability is no longer an operational upgrade; it is a strategic differentiator.
The timing could not be clearer.
With 2026 offering a rare moment of reduced delivery pressure, contractors have the opportunity to modernise their commercial systems before the surge arrives throughout 2027. By strengthening project cost accounting, improving margin tracking and enabling real‑time cost visibility, organisations can enter the next cycle with the commercial resilience needed to thrive in a high‑volume, high‑complexity environment.
Summary
The UK infrastructure sector is entering a decade of sustained growth. The contractors who succeed will be those who act now – building the digital and commercial foundations required to deliver confidently, protect margin and respond quickly to emerging risks. Advanced project cost management is no longer optional; it is the backbone of future competitiveness.
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