The 3.3% trap
The forecast says down 3.3%. Acting on that number will cost you.
The Construction Products Association published its Summer Forecast on 27 July. Total construction output forecast to fall 3.3% this year, with a modest 1.2% recovery pencilled in for 2027.
If you run an AEC firm, that headline invites one response: batten down, trim spend, wait it out. Marketing is usually first on the list.
That response reads the wrong number.
The average is hiding the story
3.3% is a blend, and the sectors underneath it are moving in opposite directions.
Private housing new build is forecast to fall 10% this year. The CPA had it at 7% three months ago, so the outlook is getting worse, not settling. Private housing repair, maintenance and improvement is forecast down 8%. Both are dragging the average down.
Infrastructure, meanwhile, is forecast up 3.2% this year and again in 2027.
The gap between a housing-exposed contractor and an infrastructure one is not a rounding error. It is the difference between a bad year and a good one, sitting inside a single sector-wide figure that tells you neither.
Where the money actually is
The forecast is not the only signal this week. Three sets of company results point the same way.
JN Bentley went into 2026 with a £604m secured order book on its main water joint venture, and warned in plain terms that Ofwat's AMP8 programme - around twice the size of the last one - will place unprecedented demand on the industry's resources. Water is spending hard, and the constraint is people, not pipeline.
Tonroe passed £1bn in revenue, up 27%, on the back of data centre work across Europe. Overseas work now makes up over half its turnover, with data centres the engine behind the growth.
Forterra, which makes bricks, saw first-half revenue fall 13.5%, or 9.3% once you strip out businesses it has closed, as housing softened. Its margin still improved, helped by cost discipline and a lean toward specialist products rather than chasing volume in a weak market.
Falling market. Two demand surges and a manufacturer holding its margin by narrowing its focus. This is not a sector in uniform retreat. It is a sector sorting itself into winners and losers by where they happen to be pointed.
Three questions this forces
The forecast is not really a finance story. It is a targeting problem, and it lands on three questions.
Who you sell to. If most of your pipeline sits in private housing, the market is telling you to widen it before the 10% becomes your year. If you already touch water, energy or data centres, the market is telling you to plant a flag there while demand is running ahead of supply. Widening is not a rebrand, though. Those sectors come with accreditations, references and specialist capability you either have or have to build, so the honest first question is which growing market you already have a right to compete in.
How you win work. When a client sector is capacity-constrained, as water now is, the bottleneck moves. Winning the work depends on being able to resource it, which turns some of your marketing into recruitment marketing and employer brand almost overnight.
How you position. In a soft sub-sector, the Forterra move is the instructive one. Being the obvious specialist choice beats being one of ten firms competing on price for shrinking volume. That is a positioning decision, and positioning decisions do not make themselves.
The part that gets cut first is the part that decides this
Here is the uncomfortable bit. Repointing a business toward where demand is - changing who you target, what you say, and how you show up to a different client sector - is marketing work. It is the exact capability most firms cut when a forecast like this lands.
I have been on the receiving end of that. Earlier in my career, mine was the budget that got cut when the outlook turned. It is an easy decision to make and an expensive one to unwind.
A 3.3% fall is not an instruction to spend less on marketing. It is an instruction to spend it somewhere else, deliberately, and sooner than your competitors. The firms that come out of 2026 ahead will be the ones that treated the split as a targeting decision and made it on purpose.
Cut marketing now and you are not saving money. You are handing your competitors first pick of the sectors that are still growing.
The average will still say 3.3%. What you do underneath it is the whole game.
Figures from the Construction Products Association Summer Forecast, 27 July 2026, with company results from JN Bentley, Tonroe Group and Forterra reported the same week via Construction Enquirer.