The construction figures published in the first week of November 2026 tell the same story on both sides of the world, and it is an awkward one. There is work about, and in some sectors there is more of it than last year. But the money is harder to keep, and the growth is landing in places most small trade businesses cannot reach.
What the latest numbers say
In the UK, the S&P Global construction purchasing managers’ index fell to 43.6 in October, down from 46.1 in September and below the 46.5 most economists expected. Anything under 50 means the sector is shrinking, and the UK has now been under that line for close to two years. Housebuilding was the worst of it, with the biggest slump so far this year, which S&P’s economics director put down to borrowing costs, weak consumer confidence and general uncertainty.
The detail underneath matters more than the headline. Civil engineering fell at its slowest pace since May 2025, held up by infrastructure spending. Commercial work reported strong demand for data centre projects and rising workloads in energy and utilities. So within a contracting market, two sectors were doing fine.
In the US the picture looks healthier on the surface and similar underneath. Associated Builders and Contractors put contractor backlog at 8.7 months in September, up for a second month in a row. But more than a quarter of contractors expected their profit margins to shrink over the following six months, the highest share since November 2025, and sales expectations fell to an 11-month low.
The reason is cost. Construction input prices in the US rose 11.2 percent over the year to September, the largest annual increase in nearly four years.
Why the market has two speeds
Almost all the momentum is in one place. US spending on data centres rose 8.6 percent in September alone. Strip data centres and the related power work out of the figures and nonresidential spending actually fell.
The split shows up in order books too. ABC members with data centre contracts reported 11.3 months of backlog, roughly three months more than firms without that work. Only 15 percent of members had any data centre work under contract at all. In other words, a small group of contractors is carrying most of the good news.
Outside that, education and healthcare lifted nonresidential planning in September, according to Dodge Construction Network, and institutional groundbreakings improved. Housing is where it is hardest.
What this means if you work on houses
Most readers of this site are small residential outfits, and residential is the weak end of both markets. That does not mean no work. It means the work is more competitive, clients are slower to commit, and the jobs that do go ahead are more price-sensitive than they were.
- Expect longer gaps between quoting and the client saying yes, and follow up properly rather than assuming silence is a no
- Repairs, maintenance and small renovations hold up better than new builds when borrowing is expensive. They are worth chasing even if they are not your favourite work
- Insulation, heating and efficiency work is being pulled along by energy costs and regulation rather than by the housing market, so it moves to a different rhythm
- If you can reach institutional work such as schools and healthcare, or maintenance contracts, that is where the planning figures are improving
If commercial work is new to you, the rules are different from residential. See our guide to quoting for commercial work.
The margin problem is the real one
Input prices rising 11.2 percent in a year is the number that should worry a small business more than any PMI reading. A busy year at the wrong rate is how trade businesses go under. Being flat out is not the same as making money.
- Shorten how long your quotes stand. A price held open for 90 days in a market moving this fast is a bet you will lose. Thirty days is reasonable, and say so on the quote
- Re-price materials at the time of quoting, not from last quarter’s figures. Merchant prices have been moving faster than most people’s spreadsheets
- Check your charge-out rate against your actual overheads. Most rates are set once and then left alone for years. See how to work out your hourly charge-out rate
- Cost the jobs you have already finished. If you are not doing this you are guessing. See job costing: did the job make money?
- Watch your cash, not just your order book. Longer payment chains hurt most when margins are thin. See cash flow basics for trade businesses
The number worth watching on your own jobs
National figures are background. The one that decides whether your year works is the gap between what you quoted and what the job actually cost, measured on every job you finish. If that gap is narrowing month by month, the market is squeezing you, and you will see it months before any index tells you.
Two or three jobs costed properly will tell you more about your business than any of the numbers above.
Sources
- S&P Global UK construction PMI for October, reported 5 November 2026
- Construction Dive on the latest ABC and Dodge figures, 6 November 2026
Figures are as reported in early November 2026 and cover the UK and United States. Conditions in New Zealand, Australia and elsewhere differ, and indices are revised. This is general information, not financial advice.