Construction UK: Consumer Confidence Falls to Two-Year Low and Why This Matters for Projects in 2026

UK consumer confidence deteriorated further in December, reaching its weakest level in nearly two years. According to the latest S&P Global UK Consumer Sentiment Index (CSI), the headline index fell to 44.7, down from 45.2 in November, signalling broad-based pessimism across household finances, spending intentions, and job security. Shifts in consumer sentiment have a direct impact on construction businesses and the organisations responsible for project delivery, influencing their ability to plan and execute projects effectively.

For the construction sector, consumer sentiment is a critical forward indicator. Weak household confidence typically translates into delayed purchasing decisions, subdued housing demand, and increased pressure on private development pipelines. The concept of project management becomes especially important as organisations adapt to changing market conditions. Construction project outcomes are shaped by various factors, including market demand, consumer confidence, and organisational strategy.

Household finances under strain

S&P Global reports that households are more pessimistic about their future financial wellbeing than at any time since late 2023. Expectations for financial conditions over the next 12 months fell to a 24-month low, while current financial conditions continued to deteriorate. Individual projects, such as refurbishing a house, are also affected by shifts in consumer confidence, making personal home improvements more challenging in the current climate.

This environment increases uncertainty for residential developers, particularly in discretionary segments such as private housing, mixed-use developments, and higher-value refurbishments. Developers' knowledge of market trends and financial planning is crucial for navigating this uncertainty. They must carefully consider various aspects of project delivery, including planning, budgeting, and risk assessment, to ensure successful outcomes in a challenging construction UK market.

Spending intentions continue to weaken

Spending sentiment declined again in December, with households reporting a reduced willingness to make major purchases such as cars, household appliances, and holidays. The relevant index fell to an eight-month low, reflecting ongoing caution and cash constraints.

For construction programmes, this points to:

• Slower sales absorption rates

• Increased risk of project phasing changes

• Greater importance of realistic cash-flow planning

Project teams must adapt their tasks and responsibilities in response to changing spending intentions, ensuring that each task is aligned with revised project priorities. Teamwork is crucial for successfully delivering construction projects under uncertain market conditions, as collaborative teams can respond more effectively to shifting requirements. It is essential to monitor and adjust the course of a project to ensure successful delivery, even as demand fluctuates.

Delay analysis and mitigation in uncertain times

In the face of economic uncertainty and shifting market dynamics, delay analysis and mitigation have become vital components of successful project planning and delivery in the construction industry. As projects grow in complexity and involve a wider range of stakeholders, project managers must possess a deep understanding of delay analysis methods to navigate the risks and challenges that can threaten key milestones and overall project completion.

Effective delay analysis starts with a thorough grasp of the project’s critical path and the identification of potential delay events that could impact the schedule or budget. Techniques such as collapsed as-built and as-planned analysis allow project teams to assess the extent and causes of delays, providing a clear basis for developing targeted mitigation strategies. By focusing on the longest path and critical activities, project managers can prioritize resources and adjust plans to keep complex projects on track, even when faced with unforeseen disruptions.

Resource allocation and risk management are central to this process. In today’s construction planning environment, it is essential to continuously monitor progress, assess the availability of resources, and adapt to changing project requirements. This proactive approach enables teams to respond quickly to delay events, minimizing their impact on project delivery and ensuring that key milestones are met.

Industry leaders such as Network Rail demonstrate the value of robust delay analysis and mitigation strategies in managing large-scale infrastructure projects. By leveraging methods like critical path analysis and the longest path technique, they can identify potential bottlenecks early and implement solutions that keep projects moving forward. Similarly, working under NEC contracts requires a strong focus on delay analysis to support fair and transparent project management, helping all parties understand the implications of delay events and agree on appropriate extensions of time or other remedies.

Developing the necessary skill sets for effective delay analysis and mitigation is an ongoing priority for project managers and their teams. Training in advanced planning services, delay analysis methods, and the use of AI-enabled tools can provide valuable insights and support better decision-making. Engaging with experienced consultants, such as those at B Project Ltd, ensures access to the latest expertise and best practices in construction project management, from tender programmes to completion.

Ultimately, a deep understanding of delay analysis and mitigation is essential for delivering construction projects on time, within budget, and to the highest standards. By embedding these capabilities into every stage of the project lifecycle, organizations can better manage risks, meet stakeholder expectations, and achieve success in even the most challenging environments.

What this means for project planning and controls

In periods of weak consumer confidence, programme realism becomes critical. The project manager plays a key role in implementing programme controls and monitoring project progress. Developers and contractors must:

• Stress-test schedules against slower demand

• Build contingency into milestones

• Closely monitor procurement and cost exposure

  
  

Determining when an extension of time may be required is essential, especially when specific project events cause delays. It is important to maintain a formal commitment to the project schedule and controls as part of contractual obligations. However, not all schedule adjustments or extensions are necessarily required; practical judgment should be applied based on the circumstances. Lessons learned from current projects can be used to improve planning and risk management for future projects.

At B Project Ltd, we support clients by integrating macro-economic risk signals directly into programme logic and reporting frameworks, helping project teams stay ahead of market-driven delays. For further advice or support regarding project controls and delay management, contact B Project Ltd.

Source:S&P Global Market Intelligence (2025), UK Consumer Sentiment Index – December 2025