CONSTRUCTION PAY GROWTH IS LAGGING, AND THAT MAKES HIRING DISCIPLINE MORE IMPORTANT

Construction pay growth is still lagging behind the wider economy, according to the latest BCIS analysis of Office for National Statistics earnings data.

BCIS said construction wages, measured through the ONS Average Weekly Earnings dataset, rose by 0.1% in the year to May 2026. On the month, average weekly earnings in construction increased by 0.6%.

Across the whole economy, average earnings rose by 3.4% over the same annual period. BCIS said construction earnings growth was lower than the whole economy average for the thirteenth consecutive month, and that construction workers saw the lowest annual increase in average weekly earnings across all sectors.

Dr David Crosthwaite, chief economist at BCIS, said the modest annual increase was at least positive, but reinforced the wider picture of subdued demand across the sector.

For employers, this creates a difficult hiring market. Slower pay growth might suggest less pressure on wage budgets, but that is not the same as an easy recruitment environment. Construction still has project peaks, specialist trade gaps, regional availability problems and candidates who compare offers across sectors, not only inside construction.

The latest KPMG and REC UK Report on Jobs adds the other side of the picture. Temporary billings rose at the quickest rate since April 2023 in June, while permanent placements continued to fall, though at a softer pace. The report also said temporary vacancies rose sharply in blue collar roles and solidly in engineering.

Put together, the message is clear: pay is not racing ahead across construction, but employers still need to be sharp if they want reliable people when demand moves.

Why it matters

A soft market can make employers lazy. That is the trap.

When pay growth is muted, some businesses assume candidates will wait, accept vague briefs or tolerate slow decisions. In reality, good workers still move toward clearer jobs, better communication, reliable hours, realistic travel, proper onboarding and employers who act quickly.

The commercial consequence is obvious. A project can lose momentum because the business tried to save money on the wrong part of the hiring process. A slightly underpriced role, a delayed decision or an unclear start date can cost more than a sensible offer made early.

The human consequence matters too. Workers are not spreadsheets. If pay is squeezed, certainty becomes more valuable: what is the job, where is it, how long is it for, who is managing it, when does it start and what happens next?

For V3 clients, this is where recruitment discipline earns its keep. Good hiring is not just finding names. It is turning market conditions into a practical plan: realistic pay, clean briefs, fast feedback, temporary cover and a reliable bench before the site or operation is under pressure.

Practical takeaway

Construction, engineering and industrial employers should treat the earnings data as a planning signal.

The immediate checks are:

Benchmark pay against current market availability, not last year's budget.

Separate "nice to have" requirements from the skills genuinely needed on day one.

Confirm location, travel, shift pattern, start date and contract length before going to market.

Move quickly on reliable candidates, especially for blue collar and engineering roles.

Use temporary cover where demand is uncertain but delivery cannot wait.

Keep communication tight between site, operations, HR and recruitment partners.

Review failed hires or declined offers for pay, speed, brief quality and onboarding issues.

V3 can help employers turn pay pressure and workforce uncertainty into practical recruitment action: better briefs, faster shortlists and temporary staffing cover where it protects delivery.

Call 02392 361 115 or email hello@v3recruitment.com if you need construction, engineering, industrial, office or commercial recruitment support.

Conclusion

Construction's weak earnings growth does not mean hiring is simple. It means employers need to be more precise.

The best candidates and temporary workers still respond to clarity, speed and credible offers. The employers that win will not be the ones who assume the market is easy. They will be the ones who know what they need, brief it properly and move before the pressure point arrives.

Pay realism is not generosity. It is delivery protection.

Speak to V3 on 02392 361 115 or hello@v3recruitment.com if you want help building a practical hiring plan.

Source links:

https://www.bcis.co.uk/news/average-weekly-earnings-in-the-construction-industry/

https://kpmg.com/uk/en/media/press-releases/2026/07/kpmg-and-rec-uk-report-on-jobs-july-2026.html