Construction product manufacturers optimistic after mixed first quarter

It was a mixed start to the year for manufacturers of building products but rising demand is anticipated.

The Construction Products Association’s state of trade survey for the first quarter of 2025 show a split in performance for product manufacturers’ sales volumes, depending on their product type. On the heavy side – bricks, cement and the like – a balance of 15% of manufacturers reported a fall in sales compared to 2024 Q4, which followed three quarters of growth.

For light side firms – products more commonly seen in fit-out an finishing – a balance of 55% of firms reported an increase in sales, marking the highest quarterly balance since 2019 Q3. Looking to the next quarter, 46% of heavy side firms and 100% of light side firms anticipate a rise in sales.

Comparing year on year, a balance of 8% of heavy side manufacturers reported that sales increased in Q1 2025 compared to the same quarter of 2024, marking the

second quarter of annual growth. For light side firms, a balance of 36% reported an annual increase in sales, up from the 7% balance recorded in 2024 Q4.

Overall, manufacturers remain optimistic about the year ahead, with 31% of heavy side firms and 80% of light side firms expecting sales to rise over the next 12 months, on balance. In line with these expectations, manufacturers across both categories reported an increase in employment in the first quarter. A balance of 31% of heavy side firms and 55% of light side firms increased headcount in Q1, corroborating expectations of an increase in demand and activity. However, rising costs – particularly wages and salaries – remain an inflationary factor affecting manufacturers’ input costs.

Rebecca Larkin, head of construction research at the Construction Products Association, said: “The divide in manufacturers’ sales performance in Q1 reflects the uneven pace of recovery across construction sectors. Whilst new starts in house-building, large home extensions and commercial developments remain subdued, government-backed energy-efficiency schemes and housing completions ahead of the change to stamp duty thresholds continued to support demand for light side products.

“The increase in employment and strong forward-looking sales expectations recorded in Q1 suggest manufacturers are preparing for a better second half of the year. However, the increase in global uncertainty since the survey was carried out – owing to US tariff changes – means businesses are likely to remain cautious. The next few months, and particularly once the US government’s 90-day pause ends at the end of June, will be critical for confidence, investment, and clarity.”  

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