FUTURE OUTLOOK AND STRATEGIC CONSIDERATIONS
Managing tight margins while building long-term resilience
MARKET
Overall, Ireland’s construction market in 2025 exhibits greater stability than in previous years, with inflationary pressures easing and workloads holding steady. However, the combination of tight margins, a declining forward pipeline, and persistent skills shortages points to a sector operating efficiently but at risk of unused capacity beyond 2026. Public-sector projects continue to underpin national delivery, while private investment remains subdued.
Strategically, contractors are preparing for a more competitive environment. Margins are already under pressure, and with order-book coverage dropping significantly after 2026, firms are likely to prioritise workload continuity over profitability. Diversification into retrofit and energy-efficiency upgrades offers a potential growth avenue, particularly as sustainability requirements gradually strengthen. However, survey data suggests that net-zero commitments and embodied carbon assessments remain limited, indicating that the sector has yet to fully align with long-term decarbonisation goals.
"Resourcing, contractor capability and availability as well as global supply chains will continue to cause issues through 2025 and 2026. High demand for skilled labour and uncertainty in the supply chain is a major challenge."
ROI MI survey respondant
Skills shortages remain a critical constraint, and without targeted interventions, labour availability could become a bottleneck even in a cooling market. Investment in training and retention will be essential to mitigate this risk. At the same time, procurement strategies are evolving, with two-stage tendering gaining traction as clients seek greater cost certainty and risk management. For contractors, this shift presents both an opportunity and a challenge: success will depend on balancing competitive pricing with robust delivery capability.
In summary, while the near-term outlook is steady, the medium-term picture is more uncertain. Firms that adapt early, by strengthening supply chain resilience, embracing sustainability, and securing forward workload, will be best positioned to navigate a market that is moving from pricing power to survival margins. The next 18 months will be critical in shaping whether Ireland’s construction sector transitions smoothly into a lower-growth phase or faces a sharper correction.
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