Business
FNB brings rare good news as construction confidence hits an 11-year high
Confidence finally breaks through the 50 percent mark
For a sector that has spent much of the past decade navigating stalled projects, thin margins, and policy uncertainty, the latest update from FNB offers a rare moment of optimism.
The FNB and BER Civil Confidence Index has climbed to its highest level in 11 years, landing at 52 in the fourth quarter of 2025. In simple terms, more than half of civil construction firms surveyed now say they are satisfied with current business conditions. That is a meaningful psychological shift for an industry that has largely been stuck in survival mode.
This jump did not happen overnight. The index rose by two points in the third quarter of the year before gaining a further nine points in the final quarter. The result is the strongest reading since the mid-2010s, when large-scale infrastructure pipelines were still flowing.
What is driving the better mood on the ground
According to FNB, the uplift in sentiment is closely tied to an improvement in actual activity. While official data from Statistics South Africa showed that the real value of construction works contracted by 3 percent year-on-year in the third quarter of 2025, conditions appear to have stabilised towards the end of the year.
FNB economist Siphamandla Mkhwanazi points to renewable energy and mining projects as the key stabilising forces. These projects have helped soften what could have been a far steeper decline in activity during the fourth quarter.
For many contractors, this work has provided a level of certainty that has been missing for years, particularly as South Africa pushes ahead with energy generation capacity and mining-related infrastructure.
Profitability shows signs of life again
Perhaps the most striking shift is not just that companies are busier, but that they are starting to make better money from the work they are doing.
The index measuring growth in overall profitability has reached its highest level since the end of 2007. That period, just before the 2010 FIFA World Cup build-up, is still remembered as a high watermark for the sector.
FNB is careful not to overstate the comparison. Profit margins are not back to the generous levels seen during that boom. However, margins have clearly improved, and that improvement has played a major role in lifting business confidence.
In an industry where razor-thin margins have become the norm, even modest breathing room can significantly change how companies plan, hire, and invest.
Why this matters beyond construction sites
The civil construction confidence survey is widely regarded as the best non-official indicator of infrastructure investment in South Africa. When confidence rises here, it often signals future movement in roads, energy, water, and mining-related infrastructure.
That is why economists see the current reading as encouraging for the broader economy. Higher confidence, rising activity, and improving profitability together suggest the potential for a rebound rather than a temporary blip.
Looking ahead to the first quarter of 2026, respondents expect activity to continue moving upward. While order books remain only slightly improved, the overall momentum appears intact.
Image 1: Business Tech
The catch behind the optimism
There is, however, an important caveat. The growth that is lifting confidence is highly concentrated. Renewable energy generation and mining dominate the current wave of activity, which reflects where capital and policy urgency are strongest.
While this focus is not necessarily a bad thing, it does highlight that reforms in other areas of the economy remain slow. Broader infrastructure programmes outside energy and mining are still struggling to gain traction.
For now, the mood music is undeniably better. After years of disappointment, the construction sector is finally seeing tangible signs that the tide may be turning. Whether that optimism spreads more evenly across the economy will depend on how quickly long-promised reforms translate into real projects on the ground.
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Source: Business Tech
Featured Image: Business Tech
