Macroeconomic Drivers Behind Construction Employment Growth

Three forces defined 2025’s rebound in construction employment:

• Federal Infrastructure Investment & Jobs Act (IIJA): Ongoing funding released through 2025 pumped billions into highway, bridge, and utility projects. States with ready-to-launch project pipelines—Texas, Ohio, Florida—captured early gains. (USDOT)
• Housing Deficit & Private-Sector Expansion: The national shortage of 3.2 million homes fueled a surge in residential construction activity and remodeling work.
• Technology & Energy Transformation: Data-center, semiconductor, and renewable-energy buildouts spurred nonresidential construction and kept specialty trade contractors fully booked.

These macroeconomic trends show why states that blended federal spending with private investment achieved the most robust construction sector growth.

Regional Resilience and Workforce Dynamics

Across the Midwest and Sun Belt, construction firms combined business-friendly regulations, moderate living costs, and access to skilled labor to accelerate job creation. Ohio and Illinois illustrate the balance: each maintains competitive tax environments while investing in transportation and energy infrastructure. These conditions have drawn both contractors and skilled workers from higher-cost coasts.

Federal and state partnerships continue to influence labor demand. According to the Bureau of Labor Statistics (BLS), the U.S. added nearly 210,000 construction positions between 2024 and mid-2025, outpacing overall employment growth. This rise reflects strong momentum in both nonresidential construction and public works spending.

For context, global construction spending surged from $4 trillion in 2012 to over $11 trillion in 2022, and the U.S. market represents roughly 15 % of that total (Construction Dive analysis). Such scale underscores why regional job gains carry national importance.

U.S. Construction Employment Gains in Numbers

Between April and May 2025, 27 states posted monthly construction job increases, and 33 states plus Washington D.C. reported year-over-year gains. Ohio alone added 17,000 jobs, Michigan 10,100, and Texas 28,600 — each surpassing their pre-pandemic highs. This broad-based growth shows the sector’s capacity to rebuild its construction workforce even amid uncertainty.

Median hourly pay for construction laborers and helpers rose 21 % from 2021 to 2024, reaching $46,050 annually (BLS May 2024). That growth reinforces strong salary expectations across construction careers and is helping contractors attract younger talent amid a national construction labor shortage.

States achieving the largest gains also invested in training. Programs like apprenticeships and trade school partnerships are bridging the construction workforce gap, enhancing diversity and long-term sustainability in skilled trades.

Why This Matters for Construction Leaders and Recruiters

These employment patterns offer key lessons for owners, developers, and hiring managers who rely on construction talent to meet tight deadlines. Strong regional growth correlates with aggressive recruitment and training strategies—areas where The Birmingham Group continues to help clients build high-performing teams.

With over 50 years of experience in construction recruitment, TBG has helped place thousands of construction managers and superintendents nationwide. Our insights from ongoing salary surveys and market reports guide contractors in setting competitive wages and retaining top talent. Explore the latest construction salary trends amid inflation or download our Salary Survey for complete data by role and region.

For project leaders navigating tight labor markets, adopting clear career-progression paths and upskilling programs will be essential. Read more about continuous learning in construction careers and how certifications increase job security and earning power.

If you’re a construction professional seeking your next step, you can submit your resume for confidential review or schedule a 15-minute consultation with Brian Binke to discuss career opportunities with leading U.S. builders.

U.S. Construction Market Outlook Heading Into 2026

Forecasts from the Construction Industry Outlook 2026 report suggest that the momentum seen in 2025 will extend into next year as federal funding cycles and private investments continue to drive project backlogs. Analysts expect nonresidential spending to grow by 6–8 %, led by public infrastructure and renewable energy construction. Regions with strong talent pipelines and modern permitting systems will capture the largest share of new work.

For executives planning ahead, benchmark roles using our data on project manager salary ranges, compare senior estimator compensation, and review assistant superintendent career paths. Such resources equip leaders to budget accurately and retain top-tier construction talent.

Explore more insights on our Construction Blog for market updates, salary surveys, and career strategies shaping the construction sector through 2026.

Top-Performing States in Construction Employment Growth

Across the nation, 2025’s most successful construction markets combined infrastructure investment, workforce training, and business-friendly regulation. These state-level strategies created thousands of new construction jobs and helped rebuild regional economies still recovering from pandemic-era volatility.

Texas: Energy and Infrastructure Powerhouse

Texas once again topped the charts in construction job creation, adding 28,600 new positions from May 2024 to May 2025—a 3.4% increase. Much of this growth stems from the state’s energy-driven economy, where both oil and renewable projects continue to expand. Texas is also channeling Infrastructure Investment and Jobs Act funding into highways and utility networks, fueling steady demand for skilled trades.

Corporate relocations and population inflows have boosted commercial and residential construction activity across major metros like Dallas, Austin, and Houston. These projects have created a surge in demand for construction managers, estimators, and superintendents—roles where salaries remain highly competitive. Explore current compensation benchmarks in our 2025 Construction Salary Guide.

Ohio: Manufacturing Revival Driving Job Growth

Ohio recorded one of the largest absolute gains, adding 17,000 construction jobs in 2025. The state’s manufacturing revival—including major semiconductor and industrial facility investments—has reignited construction demand in both industrial and infrastructure projects. Local construction firms have leveraged a strong construction workforce pipeline and union training programs to fill critical roles.

With major road and bridge upgrades underway, contractors across Ohio are benefitting from both public and private sector momentum. The region’s construction wage growth also reflects the national trend: a steady 20% increase in median pay from 2021 to 2024, according to BLS data. Contractors seeking skilled talent can contact The Birmingham Group’s recruiter network for access to prequalified candidates.

New Mexico: Fastest Percentage Growth

New Mexico posted the nation’s fastest construction employment growth rate—14.3%—thanks to federal laboratory investments, renewable energy projects, and logistics development. Massive solar and battery storage projects have transformed the local construction industry, creating opportunities for both established professionals and entry-level skilled workers.

Beyond energy, New Mexico’s economic diversification highlights the benefits of proactive state planning. Federal funding for research facilities and industrial expansion continues to sustain long-term construction employment. Workers in these emerging sectors are seeing rising construction salaries and demand for technical certifications related to green building and modular construction.

Michigan: Automotive Transformation and Workforce Investment

Michigan’s construction resurgence has closely followed the state’s automotive evolution. With $10,100 new jobs added—an increase of 5.1%—contractors are supporting both traditional automotive infrastructure and new electric vehicle (EV) plants. This shift has redefined project scopes, creating hybrid industrial-residential developments and major public works improvements.

Michigan’s focus on apprenticeships and community partnerships demonstrates how workforce programs can mitigate the construction labor shortage. For emerging professionals, roles like assistant superintendent or senior estimator offer clear advancement paths supported by ongoing training.

North Carolina: Tech Expansion Meets Population Growth

North Carolina continues to thrive as population migration and data center construction reshape its skyline. The state’s 10,000 new construction jobs represent a 3.7% increase driven by large-scale residential communities, highway projects, and industrial facilities. North Carolina’s success demonstrates the value of balanced construction project portfolios that combine public infrastructure with private investment.

Other notable performers include West Virginia (+12.3%), Idaho (+8.5%), Alaska (+7.7%), and Kentucky (+6.4%). These gains show that construction job opportunities exist across regions with vastly different economies—from oil states to renewable-energy hubs.

Regional Patterns and Economic Drivers of Construction Job Growth

The geography of America’s construction boom highlights deep structural shifts in the construction sector. Sun Belt and Midwest states continue to lead due to affordable housing, strong infrastructure pipelines, and consistent population growth. Federal stimulus funding amplified these advantages by directing capital to regions with fast project deployment capacity.

Texas and Florida, for example, have channeled billions into highway expansions and coastal resilience projects. These sustained investments have created stable employment across civil engineering and infrastructure construction. The resulting year-round work schedules minimize seasonal slowdowns—an advantage states in colder climates continue to address through project planning innovation.

Federal Infrastructure and Energy Investment

The Bipartisan Infrastructure Law and related programs have injected an estimated $400 billion into public works and clean energy development. States like Ohio, Texas, and Arizona are among the top recipients, leveraging federal funds for bridge replacements, airport upgrades, and renewable energy hubs. This federal influx is directly correlated with regional construction employment gains.

Energy-sector expansion remains a key differentiator. Traditional oil and gas states such as Texas and West Virginia continue to lead heavy industrial construction, while emerging markets like New Mexico and Idaho focus on solar, wind, and battery infrastructure. These parallel energy investments are reshaping the construction workforce by creating roles for electricians, pipefitters, and heavy equipment operators with green energy certifications.

To stay competitive, contractors must align recruitment with new technologies. Resources like construction certification programs and project management upskilling strategies can help employers meet these evolving skill demands.

Sector-Specific Growth: Heavy Civil, Building Construction, and Specialty Trades

While overall construction employment rose, job distribution varied by sector. Heavy civil construction saw the most consistent gains as federal and state-funded infrastructure projects ramped up. Public works initiatives—from highways and bridges to water treatment facilities—offered sustained employment even when private-sector investment slowed.

These projects also provide an entry point for younger workers entering the skilled trades. Apprenticeship enrollment in heavy construction disciplines climbed 8% year-over-year, reflecting renewed interest among career changers seeking stable, well-paid employment in construction careers.

In building construction, growth was strongest in residential and technology-driven commercial projects. The persistent U.S. housing shortage combined with surging data center and healthcare facility construction to sustain demand. Nonresidential construction remained robust in logistics and warehousing—critical for America’s evolving supply chain network.

Specialty trade contractors also thrived. Electrical, plumbing, and HVAC firms reported record backlogs in 2025 as retrofit and modernization projects accelerated nationwide. These roles continue to post the highest wage gains within construction, with average pay surpassing $60,000 annually (BLS). For a deeper breakdown by title, explore our Project Director salary report.

Construction technology adoption—like Building Information Modeling (BIM), robotics, and AI-driven scheduling—has increased productivity while reducing waste. States embracing these digital tools have seen faster project delivery and higher margins. Contractors can learn more about integrating digital systems through our insights in Construction Industry Outlook 2026.

Takeaways for Construction Firms and Job Seekers

The performance of these 27 states underscores a simple truth: regional policies matter. States that maintain balanced exposure across residential, commercial, and infrastructure construction adapt best to market volatility. Contractors benefit from diversified portfolios, while job seekers gain stability and career growth.

Whether you’re a construction leader seeking your next superintendent or an estimator evaluating compensation trends, The Birmingham Group’s Media Hub offers real-time salary data, hiring strategies, and workforce insights. Visit the Construction Blog for expert commentary on hiring trends, wage inflation, and skill development shaping 2026’s construction workforce.

Looking to advance your career? Connect with our construction recruiting team or submit your resume confidentially today. Hiring managers can schedule a quick 15-minute consultation with President & CEO Brian Binke to discuss your upcoming hiring goals.

Key Lessons from High-Growth States

The 27 states that added construction jobs in 2025 share several strategies that any region can replicate to build a stronger construction workforce. Their success wasn’t random—it stemmed from diversification, training, and smart regulation.

• Diversified Construction Portfolios: States that balanced residential, commercial, infrastructure, and industrial projects weathered market fluctuations more effectively. This approach reduced dependence on any single funding stream.
• Strategic Workforce Development: Investments in vocational programs and apprenticeships prepared young workers for high-demand skilled trades. Partnerships between community colleges, trade associations, and contractors proved critical.
• Regulatory Efficiency: Streamlined permitting, consistent inspection protocols, and clear building codes helped projects move from design to execution faster—cutting months off timelines.
• Public-Private Partnerships (P3s): These collaborations leveraged public funding and private expertise to accelerate delivery of transportation and renewable-energy projects.
• Technology Adoption: Use of BIM, modular construction, and AI-based scheduling improved project accuracy and reduced waste, allowing contractors to complete more work with limited labor.

States implementing these policies built both short-term employment and long-term sustainability. The outcome is measurable in higher construction salaries, lower turnover, and stronger regional competitiveness.

Overcoming Industry Challenges

Even the fastest-growing markets faced persistent headwinds. Skilled-labor shortages, supply-chain bottlenecks, and policy uncertainty tested contractor resilience nationwide. The most successful regions responded with creative, data-driven solutions.

Addressing the Skilled-Labor Shortage

States that offered apprenticeships, wage incentives, and flexible scheduling saw the best retention rates. Median pay for construction trades climbed more than 20% from 2021 to 2024, confirming that competitive compensation is vital for attracting new entrants. Employers that align pay scales with resources like our Construction Salary Survey gain a clear advantage in hiring.

Managing Material Costs and Supply Chains

Volatile material costs and global trade disruptions forced contractors to rethink sourcing. Some firms established regional supply hubs, while others turned to prefabrication and modular approaches to maintain predictable costs. These adaptive strategies reflect broader market trends identified in Construction Industry Outlook 2026.

Policy and Economic Uncertainty

Tariffs, immigration limits, and shifting federal priorities continued to affect project planning in 2025. Yet states that diversified funding sources—mixing federal, municipal, and private investment—showed greater resilience. Their flexible workforces and adaptable permitting frameworks allowed projects to proceed even as national regulations evolved.

Safety and Retention Improvements

Enhanced safety culture produced tangible gains. States emphasizing site-specific training, PPE compliance, and transparent reporting saw fewer incidents and higher morale. Safety has become a core retention tool, helping employers cut turnover and reinforce trust within crews.

Contrasting Lessons from Declining States

Not every region shared the boom. California, Washington, and Virginia illustrate how high compliance costs, long permitting cycles, and limited workforce pipelines can offset demand. California’s loss of 13,800 construction employees—a -1.5% decline—demonstrates how complex regulations erode project competitiveness despite strong underlying demand.

Washington’s experience reinforces the importance of economic diversification. Heavy reliance on technology and office construction left its workforce exposed when commercial projects slowed. By contrast, diversified states maintained steady employment through infrastructure and energy work.

The takeaway for policymakers: streamlined regulation, workforce investment, and infrastructure funding matter more than headline economic growth. Builders thrive where states coordinate across agencies and prioritize predictable permitting.

Future Outlook for Construction Employment 2026 and Beyond

The national outlook remains positive. The Bipartisan Infrastructure Law and the CHIPS and Science Act will continue driving public-works and manufacturing construction through 2026 and 2027. States with efficient delivery systems and strong contractor networks will benefit most from these multi-year pipelines.

Key trends shaping the next 24 months include:

• Green Construction & Climate Resilience: Growth in renewable energy, battery storage, and sustainable design will expand opportunities for construction professionals trained in green building practices.
• Digital Transformation: BIM, robotics, and AI-driven cost tracking will dominate project management, reducing overruns and improving transparency.
• Workforce Evolution: Expect stronger demand for certified electricians, estimators, and project managers as infrastructure complexity grows.
• Public & Private Investment Synergy: The IIJA and private equity in data-center and manufacturing facilities will keep nonresidential construction active across the Midwest and South.

For hiring managers preparing for continued expansion, our guidance on increasing project-manager salaries and developing retention programs can help secure top talent. Candidates exploring career advancement can submit a confidential resume or book a 15-minute consultation with Brian Binke.

Contractors that continue investing in construction technology and workforce development will lead the next cycle. By 2027, industry analysts expect total U.S. construction spending to surpass $2.5 trillion—proof that opportunity remains abundant for firms prepared to adapt.

For continuous insights, follow The Birmingham Group’s Media Hub and Construction Blog—your sources for data-driven recruiting and compensation intelligence across the U.S. construction sector.

Ready to Strengthen Your Construction Team?

Whether you’re a hiring manager planning large-scale projects or a construction professional pursuing growth, The Birmingham Group’s 50-plus years of experience in construction recruiting can help you build your next Dream Team. Connect with us through our contact page to discuss current searches, or explore the 2025 Salary Survey for current compensation benchmarks.

Frequently Asked Questions