Two-thirds of UK construction companies say fuel is their biggest cost pressure

A new white paper from Right Fuel Card reveals that fuel costs are hitting the UK construction sector harder than almost any other industry, with two-thirds (67 per cent) of construction businesses naming it their single biggest cost pressure of the past 12 months – well above the 60 per cent national average across all sectors.

The study found energy costs (42 per cent) and insurance (28 per cent) were the next biggest concern for construction businesses, but neither came close to the impact of fuel.

The pressure is already translating into real business decisions. Over a third (36 per cent) of construction businesses say they would raise prices for customers if fuel rose by another 10p per litre, and 17 per cent have already delayed hiring as a direct result of rising costs, while 11 per cent have made redundancies (above the eight per cent national average).

Looking ahead, 45 per cent of construction businesses expect fuel prices to directly reduce their profits over the next year – which is in line with the national picture, though the sector arrives at that figure from a starting point of higher fuel exposure.

Nonetheless, despite the pressure, the sector reports notable resilience: 33 per cent say they are “concerned but believe they can adapt” – the second highest confidence level of the sectors surveyed, behind only technology (35 per cent).

With fuel remaining construction’s biggest overhead, the study suggests businesses that build in cost protection and improve visibility over fuel spend are better placed to manage the pressure than those reacting only once costs have already risen.

To read the full white paper click here.

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