In recent years, there has been a significant rise in construction salaries. This is something that both companies and employers must be aware of, as it influences what is considered a competitive salary.

Recent Figures

The Associated General Contractors of America regularly measures all of the wages and salaries. They found an increase of 3.2% up to $30.73 in 2021.

It is also worth noting that this figure is higher than that of the private sector on average, which is just $27.90. For reference, the construction average wage of $30.73 is 10.1% higher than this.

Why the Construction Salaries Have Skyrocketed

The reason behind the rise in construction salaries is straightforward. It comes down to supply and demand. There has been a shortage of skilled workers for several years now.

Figures from the Department of Labor offer insight into how large of a shortage there is. It was last reported in May, at which time there were 360,000 construction openings. This was the highest number of openings of any of the 19 years this metric has been tracked.

Based on past and current trends, experts predict construction will need 747,000 more workers by 2026.

But why is there such a difference between the supply and demand for construction workers?

Demand Is Finally Recovering from the Recession

Part of the increased disparity is the fact that demand is finally starting to increase following the housing crash and recession. 2013 saw the post-recession low in remodeling, but that has increased 38%. Between 2015 and 2017, there were 6% more homebuyers under 35.

Construction Education Is Underfunded

The education system in the U.S. also prioritizes a traditional college experience instead of learning trades. The lack of funding in the trades combines with the stigma that it doesn’t pay well or doesn’t use technology. Other common misconceptions include that it is too physically demanding or dirty.

Experienced Workers Are Getting Older

On top of the increased demand and decreasing supply, the construction industry has aging workers. The median age is 42.5. Experts estimate that only one worker enters the industry for every five that retire.

There Is Also a General Trend Toward Salary Increases

Recent data also shows that increasing wages aren’t unique to the construction industry. The Conference Board found that companies were allocating 3.9% of their 2022 payroll budget to raises. This is the largest increase in this type of allocation since 2008.

Combine this fact with the earlier figure comparing construction wages to those in the private sector. Remember that construction wages are 10.1% higher. Theoretically, construction will maintain this lead even with the increase.


Construction wages are increasing thanks to the increased demand for workers combined with a decreased supply. Applicants can use this knowledge to negotiate fair compensation. For construction companies, it highlights the importance of discussing competitive wages with recruiters.

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