WEALTH August 11, 2026 0 Comments

Is the Irish Construction Boom Back? What July’s Surprising Growth Means for Investors and Entrepreneurs

Ever wonder if Ireland’s construction sector could stage a comeback quicker than a cat on a hot tin roof? Well, July threw us a curveball in all the right ways—the latest AIB Construction PMI shows the sector not only bounced back but sprinted ahead, snapping out of that slump June left it in. The Total Activity Index shot up to 53.0 from a dismal 45.4, proving that when the chips are down, grit and guts still make the difference. Commercial construction is leading the charge, housing’s inching its way back, and civil engineering finally shook off a 14-month hangover of decline. Now, it’s not all sunshine and rainbows—tender opportunities remain as rare as hen’s teeth—but with firms ramping up staffing and optimism creeping back, the question isn’t if the sector is growing—it’s how fast will it run now? Buckle up, the second half of the year is looking mighty interesting. LEARN MORE

Ireland’s construction sector returned to growth in July as activity and new business recovered from sharp declines recorded the previous month, according to the latest AIB Construction PMI.

The AIB Ireland Construction Total Activity Index rose to 53.0 in July, up significantly from 45.4 in June.

A reading above 50 indicates growth, with the latest figure pointing to a solid monthly increase in construction output as the sector entered the second half of the year.

Activity has now increased in four of the past six months, while all three categories monitored by the survey recorded growth for the first time in 15 months.

Commercial construction was the strongest-performing area, recording a solid increase in activity and its fifth monthly expansion in the past six months.

Housing activity also returned to growth, albeit modestly, ending a three-month period of contraction. Civil engineering recorded its first increase in activity since April 2025, bringing to an end a 14-month sequence of declines.

Firms attributed the improvement in activity to stronger customer demand, while new orders also returned to growth following a marked decline in June.

However, the increase in new business was only slight, with respondents continuing to report a scarcity of tender opportunities.

John Fahey, AIB Senior Economist, said the figures indicated that the construction sector had entered the third quarter with “some renewed momentum”.

“The headline index rose sharply and moved back into expansionary territory last month, printing at 53.0. This compared to a very weak 45.4 in June,” he said.

Fahey said the improvement was broad-based, with all three construction subsectors recording growth for the first time since April 2025.

“The best performing of the three and main driver of the expansion was commercial,” he said.

“Meanwhile, activity levels in the residential sector expanded for the first time since March, albeit the rate of growth was modest.”

The latest survey also pointed to continued job creation across the sector.

Construction firms increased staffing levels for the ninth consecutive month, with the pace of employment growth accelerating from June.

Contractors also increased their use of subcontractors at the joint-fastest pace in almost three-and-a-half years, resulting in a marked reduction in subcontractor availability.

There were also signs of easing cost pressures. Input prices continued to rise rapidly but did so at their slowest rate in five months, while increases in subcontractor rates were at their lowest level since February 2025.

Supply-chain disruption also eased, although vendor performance continued to deteriorate, with international shipping issues contributing to longer lead times.

construction — Activity has now increased in four of the past six months, while all three categories monitored by the survey recorded growth for the first time in 15 months.

Business confidence strengthened for a third consecutive month and reached a four-month high, with firms optimistic that the improvement in new orders could be sustained.

However, sentiment remained below levels recorded before the outbreak of war in the Middle East.