President Donald Trump’s recent announcement of a 10% tariff on all UK imports of US goods, alongside higher tariffs on specific countries, is poised to significantly affect the UK construction sector.
As the US reimposes import duties on steel and aluminium, the UK construction industry could face disrupted supply chains and increased material costs, potentially leading to project delays, according to EPD, an aftermarket parts and components seller for construction, agricultural and industrial machinery
Calum Mair, Commercial Director North America for EPD, has shared how these ever-changing policies could threaten the construction industry, and how UK businesses should prepare.
“Since his election win, President Trump has both enacted and delayed a 25% tariff on Canadian and Mexican imports, as well as threatened and imposed a number of additional Chinese and global tariffs. The tariffs on imported materials will significantly raise construction input costs worldwide, impacting project budgets. With the recent introduction of the 10% UK import tariffs on US goods, UK businesses could face further pressures from rising material costs and disrupted supply chains and should consider diversifying suppliers, which can reduce dependency on vulnerable trade routes.
“They should also consider stockpiling critical materials, leveraging technology for logistics, and focusing on no or low-tariff jurisdictions. His stricter immigration policies could also exacerbate workforce shortages globally, including here in the UK where the construction sector already faces skills gaps. It’s likely businesses will need to invest in workforce development programmes, including training initiatives to attract and upskill domestic workers. Expanding the use of automation and construction technology can also help offset labour gaps.
“The uncertainty around interest rates has also posed new challenges when planning new construction projects, as fluctuating borrowing costs could impact financing both in the UK and abroad. Looking ahead, UK businesses should prioritise cash flow management and, where possible, explore alternative funding options to reduce dependency on loans, as well as adopting sustainable, lower-cost materials and maximising resource efficiency. Proactive planning is more important than ever and ensures resilience against interest rate volatility while supporting project feasibility.”
Global ESG regulations and US deregulations could disrupt pricing
While the UK and EU continue to strengthen ESG (Environmental, Social, Governance) policies in construction and energy, the US is expected to deregulate which means lower costs for builders and others in the construction industry. However, this could create pricing disparities and add cost pressures for building supplies to UK businesses that rely on imported materials.
“Investing in sustainable practices and materials now can reduce long-term reliance on high-cost imports and align with future regulatory trends,” says Calum. “Proactively adapting supply chains ensures cost control while maintaining compliance and sustainability goals.”
Interest rates to remain uncertain for the near future
Although the Bank of England sets UK interest rates, changes in the US Federal Reserve’s decisions heavily influence global markets. With near-term US interest rates still uncertain, any shifts under Trump’s administration could indirectly affect businesses planning new projects in 2025 in Britain, particularly multinational construction firms and suppliers.
Although the Federal Reserve has forecasted a drop in interest rates over the next year, from around 4.5% at the end of 2025 to around 3.4% at the end of 2026, near-term rates are less certain. Interest rate volatility could affect businesses looking to start new projects in 2025 as higher rates make borrowing more expensive.
Mair adds, “Although there may be challenges ahead, there are solutions businesses can adopt to help ease the burden they might cause. By diversifying supply chains, prioritising domestic sourcing, and adopting sustainable materials, firms can offset the impacts of tariffs and global ESG regulations. Workforce development programmes and advanced technologies can address labour shortages caused by stricter immigration policies. Additionally, proactive financial planning and resource optimisation can help businesses manage uncertainty around interest rates and maintain project stability.”