2025 was flat and challenging; however, 2026 may well bring regulatory clarity, a fairer payment culture, AI adoption, and opportunities to grow talent.
As we take down the tinsel and glance furtively at the bathroom scales, we are compelled to look 2026 squarely in the face.
For me, 2025 goes down as one of the least remarkable years in recent memory, pretty bland, especially given the tumultuous decade we have had so far! The market was flat, housing targets were barely dented, and higher risk projects remained constipated by an undercooked regulator. Commercial projects struggled as well, weighed down by uncertainty and indecision.
We did not see much in the way of new regulation – the Government spent more time testing policy on the polls than putting its best foot forward. The Budget probably raised more questions than it answered, and I still do not really know what the UK’s Strategy for Growth is, other than knowing it has not really worked so far!
That said, some groundwork has been laid that could make 2026 an interesting year. The Health and Safety Executive is no longer holding the reins of construction regulation; the independent Building Safety Regulator is now established and has made a strong start clearing Gateway 2 backlogs.
They have made bold statements about efficiency in 2026, which could help unlock much-needed work. The picture is also becoming clearer on competence and organisational capability, and what they expect to see in applications.
The consultation on Approved Document B, covering fire safety matters within and around buildings, will keep us busy this year.
My hope is that it will provide a good opportunity to clarify some challenging compliance questions and help smooth out the kinks in the new regulatory environment, particularly the interface between product performance and design responsibility.
The consultation on Late Payment and Retention was a highlight of 2025. Some of the Government’s suggestions were almost directly aligned to policy asks set out in the FIS Manifesto: A Blueprint for Change. Could 2026 finally be the year we say goodbye to retentions, or at least welcome regulation that bans them?
If we are to believe the economists, new projects should start picking up across most sub-sectors and regions as the year progresses. This is good news, but the challenges of 2025 did not help our efforts to increase recruitment and training of new entrants. The labour situation is likely to remain tight.
After countless attempts to fix the skills landscape, it is easy to be cynical about the newly formed Construction Skills Mission Board (CSMB). I am choosing, once again, to be optimistic. Whilst it is unlikely to provide much relief for 2026 labour shortages, if harnessed correctly, this Board represents a generational opportunity to fix a broken system. Chaired by the Skills Minister and backed by £600 million of Government funding, this is the first time I have seen a joined-up sector engaging with a joined-up Government.
There is an appreciation that radical overhaul of the way education prepares people for work is required, and an acceptance that practical intelligence is as important as academic knowledge. Courses and qualifications delivered in schools and colleges must deliver real employment outcomes – currently, only around 6% of people studying construction courses in FE colleges go on to work in the sector! You can find out more about the CSMB on page 14 of this issue.
So, what’s in the mix for 2026? It could finally bring regulatory clarity, a fairer payment culture, and real progress on fixing the skills pipeline. Another major shift will be the rapid adoption of Artificial Intelligence in construction. The pace of change is astonishing, and “the machine” is already reshaping how projects are planned and managed. At FIS, helping you embrace
this technology will be a core theme in 2026. While I don’t believe it will replace you by 2027, it should help take some of the pressure off and tackle many of construction’s challenges in a different way.
Happy 2026! If you haven’t made a New Year’s resolution yet, consider taking on a trainee or apprentice (we can help) – and start exploring AI. It might just change the way you work. I’m sure Artificial Iain will loop back to this when he writes next year’s column!
