The U.S. construction industry experienced a surge in demand in the years following the COVID-19 pandemic. The intense real estate market during the pandemic highlighted the shortage of housing stock across the United States. Between 2020 and 2022, private construction spending rose rapidly, fueled by a wave of new housing starts. In April 2022, housing starts reached their highest level in more than 15 years before declining to pre-pandemic levels as mortgage rates climbed. And just as private construction activity began to plateau, funding for public projects became available—most notably through the Bipartisan Infrastructure Law—driving growth in public-sector construction spending.

Today, however, the outlook for the construction industry is less certain amid economic headwinds, including a softening labor market, foreign import tariffs, and persistently high interest rates. Despite these challenges, construction firms continue to face severe labor shortages. The Associated Builders and Contractors, a leading industry trade group, estimated a shortfall of 439,000 workers. Meanwhile, the Bureau of Labor Statistics reported 306,000 openings for construction jobs as of July 2025.

Originally published on constructioncoverage.com, part of the BLOX Digital Content Exchange.