Article

UK construction and contractor leaders: turning market change into growth

Discover how UK construction leaders are responding to supply chain failure, cyber risk, health and safety concerns and market change.

Cyber risk remains on the radar, but the sector is focused on practical priorities

Construction, contracting and engineering leaders in the 2026 UK Business Risk Report are navigating a risk landscape shaped by the everyday realities of keeping projects moving, people safe, and reputations strong.

While cyber risk is an important part of the wider business conversation, it is not currently the sector’s top concern. Just 30% of respondents in construction, contracting, and engineering identified cyber risks as a key business risk, while 34% flagged cybercrime.

This may reflect the sector’s long-standing focus on physical operations, project delivery, and workforce safety. At the same time, as supply chains become more connected and digital project systems continue to expand, many firms have an opportunity to further strengthen their cyber resilience.

Guy Fitzgibbon, Head of Global Contractors, Marsh Risk, notes:

“Cyber risk is another area that deserves closer attention. The report shows construction remains less concerned about cyber risk than many other sectors, even as digital tools, connected plant, common data environments, and third-party technology become more embedded in project delivery.

“At the same time, only 41% of construction businesses say they are currently using cyber security solutions. That gap matters. A cyber event can interrupt operations, delay completion, affect contractual obligations, and expose businesses to costs that may not sit comfortably within traditional construction insurance arrangements.”

Supply chain resilience is a major business priority

The sector’s biggest concerns are more immediate and operational. Supply chain risk stands out clearly, with 44% of respondents naming failure of key suppliers as their biggest concern. That also highlights how dependent the industry is on strong subcontractor, materials, and specialist partner networks. Where those relationships are well managed, they can become a real source of resilience, helping projects stay on track and client commitments remain intact.

Craig Charles, Head of Owners & Developers, Marsh Risk, says:

“The report also underscores the relevance of supply chain resilience. While supplier failure is often most visible at contractor level, the consequences are felt just as acutely by developers when a key delivery partner becomes distressed or fails during a project.

“Delay, additional cost, uncertainty around responsibility, and questions over continuity of cover can all follow. This is why developers need to pay close attention to the strength of the delivery chain, the financial resilience of key parties, and the protections available if a project is disrupted.”

Fitzgibbon adds:

“The findings in the 2026 Marsh UK Business Risk Report closely reflect what we are seeing across the contractor market. In construction, contracting, and engineering, 44% of businesses cite failure of key suppliers as their biggest operational concern.

“That is understandable in a sector where delivery depends on complex supply chains, tight margins and careful co-ordination across multiple parties. When disruption occurs, the consequences can move quickly from delay and cost pressure to contractual, insurance, and project delivery issues.”

He continues:

“For contractors, this reinforces the need to look beyond immediate procurement challenges and consider the resilience of the wider supply chain. Due diligence on supply chain partners, clearer contractual allocation of risk, stronger financial monitoring, and contingency planning all have a role to play.

“Subcontractor insolvency and default remain a persistent concern for the sector and does not appear to be going away. That is why innovating effective solutions for our clients to address this challenge is a key priority for Marsh Risk.”

Health and safety stay high on the agenda

People risk remains high on the agenda, underscoring the sector’s continued focus on care and compliance. Thirty-one percent of leaders are concerned about the health and safety of the public and employees, while 34% are focused on health and safety from a compliance, legal and regulatory perspective.

In an industry where worksites are inherently hazardous and expectations continue to rise, these priorities show a strong commitment to protecting workers, communities and business continuity.

Charles adds:

“People risk is also an important part of the picture. Across UK business, mental health and wellbeing remains a material concern, and in construction this has clear implications for governance, culture, and reputation.

“That is why Marsh Risk was proud to support the production, and recent launch, of the Construction Leadership Council’s Mental Health Joint Code of Practice as a broker partner - helping to shape a practical, sector-wide framework that encourages a more preventative approach to mental health across the industry.

“For developers and asset owners, expectations are becoming more explicit around how projects are managed and how workforce wellbeing is supported.”

Reputation and competition are driving continuous improvement

Reputation is another major theme. Forty-six percent of respondents are concerned about damage to their brand or image, and 44% are focused on the impact of new competitors entering the market.

In practice, that reflects a sector that understands the value of trust, delivery quality and consistent risk management. New entrants and competitors - particularly those with digital capabilities, alternative delivery models or competitive pricing - are also encouraging established firms to sharpen their own proposition and operational discipline.

Charles says:

“The 2026 Marsh UK Business Risk Report highlights a risk environment that owners and developers are having to navigate with increasing care. In property and real estate, 52% of businesses cite new rules and legislation as a key concern - the highest level of any sector in the research.

“That reflects the cumulative effect of regulatory change, more complex compliance demands, and the need to factor these obligations into decision-making much earlier in the life of a project.”

He adds:

“For owners and developers, the issue is not simply the volume of regulation, but the way it affects project viability, procurement strategy, insurance requirements, and long-term asset exposure.

“The Building Safety Act has been particularly significant in reshaping the landscape, and the market is still adjusting to its implications. In this context, early engagement on risk, insurance, and governance is becoming increasingly important, particularly where complex developments or higher-risk assets are involved.”

Leaders are taking practical steps to strengthen resilience

The good news is that businesses are not standing still. Over the last 12 months, leaders have focused most on employee training, with 51% reviewing it. They have also revisited:

These actions suggest a sector increasingly aware that resilient operations depend on more than equipment and contracts - they depend on capable people, strong leadership and disciplined management.

Future priorities point to workforce and operational support

Looking ahead, the priorities remain practical and people-centred. In the next 12 months, firms plan to review:

That mix points to a broader understanding that risk management is not just about compliance; it is about retention, productivity and performance under pressure.

Confidence is high - with scope to build further

Overall, confidence in risk management is solid: 62% of respondents say they are confident in their business’s risk management framework.

That leaves a meaningful group still working to strengthen consistency across their approach, but it also shows that many firms already have a strong foundation on which to build.

Infrastructure delivery and specialist cover

Fitzgibbon says:

“We are also seeing risk priorities shift alongside changes in the infrastructure landscape. As investment commitments change, contractors will need to adapt to different project pipelines, delivery models, and insurer expectations.

“In that environment, consistency of cover, clarity of wordings, and access to solutions designed for specialist construction risks become increasingly important.”

Marsh has launched Strada, a construction facility designed for road and highway risks, including provisions that address common insurance challenges such as extensions, open-to-traffic phases, and phased completions.

This solution aims to accelerate project delivery, empowering clients to scale their infrastructure commitments across the UK with greater speed and certainty.

Marsh has launched Machina, a facility covering the full range of contractors’ plant and equipment needs and designed for both standalone placements and annual construction programmes.

This solution aims to streamline the placement process, giving clients the confidence and operational agility they need to capitalise on opportunities in the UK’s growing infrastructure market.

He concludes:

“The sector has a central role in delivering the critical and social infrastructure projects of the future, while also supporting the UK economy.

“Our focus is on helping clients navigate an increasingly demanding and interconnected risk environment, so they are better placed to deliver with confidence in an evolving market.”

Charles ends:

“The opportunity across the sector remains substantial, but so too does the complexity of the risk landscape.

“Our focus is on helping clients make informed decisions at every stage of the project lifecycle, with risk and insurance strategies aligned to today’s regulatory, operational, and people challenges.

“In a market defined by change, delivery pressure, and growing accountability, that support is critical to enabling the infrastructure projects of the UK’s future.”

A more integrated view of risk will be essential

For leaders in construction, contracting, and engineering, the challenge is clear:

At the same time, cyber risk should not remain an afterthought. As digital tools become more embedded across design, planning, procurement and site management, a more rounded view of risk will be essential.

The firms that succeed will be those that treat risk management not as a defensive function, but as a foundation for competitiveness, trust, and long-term growth.

Rows of illuminated server racks fill the room, casting a blue glow. The facility operates efficiently, showcasing technology and infrastructure vital for data management at night.

Article

UK construction and contractor leaders: turning market change into growth

Cyber risk remains on the radar, but the sector is focused on practical priorities

Supply chain resilience is a major business priority

Health and safety stay high on the agenda

Reputation and competition are driving continuous improvement

Leaders are taking practical steps to strengthen resilience

46%

45%

44%

44%

Future priorities point to workforce and operational support

24%

20%

20%

19%

19%

19%

Confidence is high - with scope to build further

Infrastructure delivery and specialist cover

A more integrated view of risk will be essential

Strengthen supplier resilience

Keep safety at the centre of operations

Invest in the workforce systems that support delivery

Our people

Craig Charles

Guy Fitzgibbon

Related insights

Data centres: Mitigating risks during times of conflict

Embracing sustainability: The benefits of adopting circular economy principles for UK construction companies

Carbon capture, usage, and storage: What is the potential impact on UK construction?

Surety bonds in the UK: Why the bond wording can make or break your company