Average weekly earnings in the construction industry

The Office for National Statistics (ONS) publishes monthly updates on average weekly earnings across the whole economy and by industry and sector in Great Britain. This commentary relates to ONS’s EARN02 and EARN03 datasets, which cover non-seasonally adjusted earnings, excluding bonuses and including arrears.

Annual rise in construction wages recorded for first time in seven months

Construction wages, as measured by index K5AH in the ONS’s Average Weekly Earnings dataset⁽¹⁾, increased by 1.1% in the year to July 2026, following a 0.1% decline in the year to June. This marked the first acceleration in annual earnings growth in the sector since December 2025.

On the month, there was a 1.2% increase in the construction industry’s average weekly earnings.

Across the whole economy, the average increase in earnings in the year to July 2026 was 3.6%, down slightly from the 3.8% increase seen in the year to June 2026, according to index KA5H⁽²⁾.

Dr David Crosthwaite, chief economist at BCIS, said: ‘In July, construction wages rose year-on-year for the first time since December 2025. Given the current economic backdrop and impact on demand, it’s more likely to be an isolated uptick than a return to significantly higher levels of pay growth, though this cannot be ruled out.

‘Wage growth is an area where you want to see upward movement, as it often reflects stronger workloads and employers’ ability to maintain wage parity. However, periods of weaker growth are often inevitable in construction because of fluctuating workloads and the way the industry operates.

‘We should take the latest rise as a positive, while bearing in mind that conditions in the Middle East have escalated since July and may have negatively affected wage growth in the months since.’

Annual growth in average weekly earnings in construction was lower than the whole economy average for the fifteenth consecutive month in July 2026.

^{Source: ONS – EARN02: Average weekly earnings by sector, Table 7, and EARN03: Average weekly earnings by industry, Table 4}

Comparing pay at a sector level (using index K56S), construction saw the lowest rise in annual pay growth in the year to July 2026.

The greatest annual wage growth was recorded in the public sector with a 6.1% rise.

^{Source: ONS – EARN02: Average weekly earnings by sector, Table 7}

The ONS data show that the construction sector has experienced the most extreme fluctuations in earnings movement in recent years, from a 9.5% annual decrease in May 2020 to a 13.5% increase year-on-year in May 2021.

^{Source: ONS – EARN02: Average weekly earnings by sector, Table 7}

BCIS produces five-year forecasts of the Average Weekly Earnings construction (K5AH) and whole economy (KA5H) time series for subscribers of BCIS OpX.

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^{(1) Office for National Statistics – EARN03: Average weekly earnings by industry  - here}

^{(2) Office for National Statistics – EARN02: Average weekly earnings by sector  - here}