The construction sector continues to reflect a division between renewed investment optimism and deep-rooted structural weakness according to Industry Insight.

On the one hand, the civil construction market showed notable growth, with projects awarded exceeding R53 billion during the first four months of 2025, driven by large water and transport contracts and on the other hand, the overall construction pipeline shrank by 17.4% year-on-year by March 2025 with public building tender values having dropped 18% and delays and cancellations having increased sharply.

Residential approvals and building material mining volumes also declined with the likes of Limpopo, the Free State, and KwaZulu-Natal posting pipeline contractions of over 30%.

The total number of construction projects awarded dropped 29.2% year-on-year in May 2025 to just 132 – the lowest since August 2022 with the total value of awards increasing by 11.7% to R5.9 billion. This divergence was driven by several large-scale civil and building contracts including a R1.2 billion photovoltaic and battery storage tender in Cape Town and an R800 million housing development Umhlanga.

Provincial trends were uneven, with significant declines in project numbers in KwaZulu-Natal, Mpumalanga.

While the private sector shows pockets of resilience, particularly in the Western Cape and segments of the JSE-listed construction and property companies such as PPC, broader recovery is undermined by non-payment, corruption, procurement delays, and a high reliance on state-driven activity.