Construction input prices decreased 0.6% in December compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data. Nonresidential construction input prices decreased 0.7% for the month.

Overall construction input prices are 2.8% higher than a year ago, while nonresidential construction input prices are 3.2% higher. Prices increased in 2 of 3 energy categories last month. Natural gas and unprocessed energy materials prices were up 34.8% and 5.5%, respectively, while crude petroleum prices were down 2.7% in December.

“Construction materials prices posted a welcome decline in December, yet key inputs are still experiencing rapid escalation,” said ABC Chief Economist Anirban Basu. “This is especially true for materials most exposed to tariffs. Copper wire and cable prices, for instance, jumped an incredible 4.6% in December and are up more than 22% year over year, and prices for primary nonferrous metals are up nearly 62% over the past 12 months.

“Prices for commodities less exposed to tariffs, like asphalt or crushed stone, will likely remain tame in the coming months due to soft demand for construction services,” said Basu. “While that may limit increases in overall materials prices, trade policy will continue to put upward pressure on certain materials. This has not significantly dimmed contractor optimism; 7 in 10 ABC members expect their profit margins to remain stable or grow over the next two quarters, according to ABC’s Construction Confidence Index.”

The national December 2025 not seasonally adjusted construction unemployment rate was 5.0%, a 0.2% decrease from December 2024, according to a state-by-state analysis of U.S. Bureau of Labor Statistics data conducted by Associated Builders and Contractors. The analysis found that 60% of states (30) had lower estimated construction unemployment rates over the same period, 17 had higher rates and three states (New Hampshire, Pennsylvania and Texas) had the same rate. All but five states had construction unemployment rates below 8%.

Note that, as a result of the 2025 government shutdown, no October labor data were collected, so those data are missing/not available.

National NSA payroll construction employment was 12,000 higher than December 2024, its smallest year-over-year increase since March 2021 when it fell during the pandemic. Seasonally adjusted payroll construction employment was 8.3 million, or 9.1% above its pre-pandemic peak of 7.6 million.

Estimated state construction unemployment rates were lower than their pre-pandemic level in 60% of states. As of December 2025, 30 states had lower construction unemployment rates compared to December 2019, while 18 states had higher rates and two states (Georgia and New Mexico) had the same rate.

“The construction industry continues to contend with weaker demand from the headwinds of tariffs and supply disruptions pushing building materials prices up, increasing insurance costs and an uptick in immigration enforcement contributing to a shortage of skilled construction workers, which has added to pressure to raise wages and salaries,” said Bernard Markstein, president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “On the positive side, a somewhat easier policy stance by the Federal Reserve has resulted in lower interest rates. Further declines in interest rates are likely this year. Adoption of software and equipment powered by artificial intelligence may help some companies to control costs and reap greater efficiency from their existing workforce.”

Recent Month-to-Month Fluctuations

In December, the national NSA construction unemployment rate climbed 0.9% from November. Three states (Alabama, Montana and New Mexico) had lower rates, 44 posted higher rates and three states (Alaska, Georgia and Mississippi) had the same estimated construction unemployment rates as in November.

The Top States

The six states with the lowest estimated NSA construction unemployment rates for December were:

1. Hawaii, 2.0%
2. Oklahoma, 2.5%
3. Colorado, 2.7%
4. Georgia, Indiana and Mississippi (tie), 2.8%

Both Hawaii and Indiana had their lowest December NSA estimated construction unemployment rate on record. Note that Hawaii’s unemployment rate is for construction plus mining and logging. Colorado posted its second-lowest December rate on record behind the 1.8% rate the state achieved in December 2021. Georgia and Oklahoma each had their third-lowest December construction unemployment rate on record.

The Bottom States

The five states with the highest September estimated NSA construction unemployment rates were:

46. Illinois, 9.4%
47. New Jersey, 10.1%
48. Connecticut, 10.5%
49. Rhode Island, 11.2%
50. Minnesota, 13.4%

Rhode Island recorded its lowest December rate since its December 2022 rate of 8.9%.

Click here to view graphs of U.S. and state overall unemployment rates (Tab 1) and construction unemployment rates (Tab 2) showing the impact of the pandemic, including a graphing tool that creates a chart for multiple states. To better understand the basis for calculating unemployment rates and what they measure, check out the Background on State Construction Unemployment Rates.

National nonresidential construction spending remained virtually unchanged on a monthly basis in October and was down 0.9% year over year, according to an Associated Builders and Contractors analysis of data U.S. Census Bureau data. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.25 trillion.

Spending was up on a monthly basis in 9 of the 16 nonresidential subcategories. Private nonresidential spending was down 0.2%, while public nonresidential construction spending was up 0.1% in October.

“Nonresidential construction failed to gather momentum at the start of 2025’s third quarter,” said ABC Chief Economist Anirban Basu. “While there are few sources of private nonresidential growth outside of the still surging data center category, much of the recent decline in construction spending is due to a precipitous drop in manufacturing investment. With CHIPS Act-enabled megaprojects winding down and the stiff headwind of trade policy, manufacturing construction spending has fallen by nearly 10% over the past 12 months, accounting for more than the entire decline in private nonresidential spending. Despite consistently downbeat construction industry data during the latter months of 2025, contractors remain upbeat about the first half of 2026, according to ABC’s Construction Confidence Index.”

The construction industry lost 11,000 jobs on net in December, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data. On a year-over-year basis, industry employment grew by 14,000 jobs, an increase of 0.2%.

Nonresidential construction employment decreased by 7,800 positions on net, with losses in 2 of the 3 subcategories. Heavy and civil engineering added 2,300 jobs, while nonresidential specialty trade and nonresidential building lost 8,900 and 1,200 jobs, respectively.

The construction unemployment rate was 5.0% in December. Unemployment across all industries dropped to 4.4% but is 0.3 percentage points higher than one year ago.

“The construction industry added just 14,000 net new jobs in 2025,” said ABC Chief Economist Anirban Basu. “Excluding the first year of the COVID-19 pandemic, that’s the worst 12-month performance since 2011, when the construction industry was still spiraling from the Great Recession. While the nonresidential side of the industry performed significantly better over the past year, even that segment’s momentum has started to wane. Nonresidential specialty trade contractors, demand for which led the industry in 2025, posted its worst month in nearly four years, losing 8,900 jobs in December.

“Despite this dismal performance, the industry’s unemployment rate remains relatively low, down 0.2 percentage points from the same time last year,” said Basu. “This unusual dynamic—decreasing employment but a steady unemployment rate—likely reflects the effects of immigration policy on the industry’s workforce. As a result, average hourly earnings for production and nonsupervisory construction workers were up 4.5% on a year-over-year basis in both November and December, a sharp increase from the 3.9% increase observed in October. While contractors remain optimistic about hiring over the next six months, according to ABC’s Construction Confidence Index, recent declines in backlog, ongoing declines in construction spending and December’s job losses suggest it could be a difficult start to 2026 for the industry.”

Associated Builders and Contractors reported that its Construction Backlog Indicator rose to 8.2 months in December, according to an ABC member survey conducted Dec. 22 to Jan. 7. The reading is up 0.1 months since November but down 0.1 months from December 2024.

View the full Construction Backlog Indicator and Construction Confidence Index data series.

Backlog continues to soar for the largest contractors and fall for the smallest. Contractors with greater than $100 million in annual revenue recorded their highest backlog since 2021, while those with less than $30 million in annual revenue recorded their lowest since 2021.

ABC’s Construction Confidence Index reading for sales, profit margins and staffing levels increased in December but are all down on a year-over-year basis. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.

“Backlog fell sharply for smaller contractors during 2025,” said ABC Chief Economist Anirban Basu. “That decline was largely due to the fact that nonresidential construction momentum is confined to the data center segment, and those projects are far more beneficial for the largest contractors. In December, the 13% of ABC members under contract to work on a data center project had significantly higher backlog (11.0 months) than those who were not (7.8 months). While contractor confidence improved slightly for the month, it remains well below late-2024 and early-2025 levels.”

Construction input prices increased 0.6% in November compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data. Nonresidential construction input prices also increased 0.6% for the month.

Overall construction input prices are 3.4% higher than one year ago, while nonresidential construction input prices are 3.8% higher. Prices increased in 2 of 3 energy categories last month. Natural gas and unprocessed energy materials prices were up 10.8% and 1.4%, respectively, while crude petroleum prices were down 1.1% in November.

“Construction input prices surged in November and are now up 3.4% on a year-over-year basis,” said ABC Chief Economist Anirban Basu. “While that’s a relatively modest annual increase, it’s also the largest since January 2023 and the trend offers plenty of cause for concern. Many tariff-affected materials, like derivative metal products and switchgear equipment, have experienced considerable price escalation in 2025. Prices for aluminum mill shapes and primary and secondary nonferrous metals are both up more than 25% over the past year.

“Unfortunately, it is impossible to know exactly how the cost of tariffs will be distributed throughout the supply chain, and that makes it exceptionally difficult to know how construction input prices will behave in 2026,” said Basu. “Despite this uncertainty, contractors are on net optimistic that their profit margins will expand during the first half of the year, according to ABC’s Construction Confidence Index, albeit slightly less optimistic than they were at the same time last year.”

The construction industry needs to attract an estimated 349,000 net new workers in 2026 to meet demand for construction services, according to a proprietary model developed by Associated Builders and Contractors. In 2027, the industry will need to bring in 456,000 new workers to meet demand as construction spending growth is poised to resume for the first time in years. ABC’s proprietary model uses the historical relationship between inflation-adjusted construction spending growth, sourced from the U.S. Census Bureau’s Construction Put in Place survey, and payroll construction employment, sourced from the U.S. Bureau of Labor Statistics, to convert anticipated increases in construction outlays into additional demand for construction workers at a rate of approximately 3,450 jobs per $1 billion in additional construction spending. This model also embeds the current level of job openings, industry unemployment and projected industry retirements into its computations. “If current consensus forecasts hold true, the construction industry will need to bring in 349,000 new workers in 2026 just to keep the supply and demand for labor in equilibrium,” said ABC Chief Economist Anirban Basu. “Failing to do so will worsen labor shortages, especially in certain occupations and regions, placing further upward pressure on labor costs. “The industry needs to attract fewer workers than in recent years, a decline that can be traced to extremely modest spending growth forecasts for 2026 and 2027,” said Basu. “Given current assumptions regarding prospective industry growth, a majority of new worker demand in 2026 will be attributable to retirement rather than increased demand for construction services, despite the ongoing boom in artificial intelligence infrastructure buildout. “The industry will need even more workers than the model predicts should current spending projections prove overly conservative,” said Basu. “That is a distinct possibility, especially if project financing costs decline unexpectedly or if lingering policy uncertainty resolves itself quickly and favorably. It is also important to note that nonresidential specialty trade contractors have added 95,000 jobs since August 2024, according to ABC analysis of BLS employment data, demonstrating that certain sectors of nonresidential construction hiring are going strong.” “ABC’s 2026 workforce shortage analysis shows a series of macrodynamics at play in the industry,” said Michael Bellaman, ABC president and CEO. “These include an aging and retiring workforce, immigration enforcement, high materials prices, tariffs, office vacancies and rapidly evolving technologies and innovation. Despite these variables, the analysis shows the construction industry still faces an urgent need for talent to build and rebuild America’s infrastructure.” “Even if construction spending fails to exceed expectations this year and next, contractors will continue to struggle to fill open positions, especially in certain occupations and regions,” said Basu. “For instance, demand for electricians capable of precision wiring has surged due to the rapid increase in data center construction. Recent industry efforts to accelerate skilled worker development have helped, but the industry is effectively swimming upstream. Approximately one-fifth of all electricians are over 55. Worker shortages also remain more severe in areas associated with industrial megaprojects, including semiconductor fabrication facilities. “The effects of immigration policy represent another potential wildcard for the industry’s labor force dynamics,” said Basu. “While the extent to which undocumented workers have exited the workforce remains unclear, data regarding border encounters indicate that the flow of undocumented workers into the country fell precipitously in 2025 while voluntary deportations accelerated.” “This slight dip in the industry’s chronic, massive worker shortage offers practical lessons,” said Bellaman. “These include federal lawmakers introducing a market-based worker visa system; reskilling and upskilling workers on new tech and innovation; and deploying ABC’s all-of-the-above workforce development strategy to bring new workers into the industry and educate them through both industry-driven and government-registered apprenticeship programs. “The construction industry does not have to fall off the workforce shortage cliff,” said Bellaman. “To avoid this outcome and shore up the talent pipeline, now is the time for action—not complacency—to reaffirm that the construction industry offers careers of choice in today's complex job market.”

The construction industry lost 11,000 jobs on net in December, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data. On a year-over-year basis, industry employment grew by 14,000 jobs, an increase of 0.2%.

Nonresidential construction employment decreased by 7,800 positions on net, with losses in 2 of the 3 subcategories. Heavy and civil engineering added 2,300 jobs, while nonresidential specialty trade and nonresidential building lost 8,900 and 1,200 jobs, respectively.

The construction unemployment rate was 5.0% in December. Unemployment across all industries dropped to 4.4% but is 0.3 percentage points higher than one year ago.

“The construction industry added just 14,000 net new jobs in 2025,” said ABC Chief Economist Anirban Basu. “Excluding the first year of the COVID-19 pandemic, that’s the worst 12-month performance since 2011, when the construction industry was still spiraling from the Great Recession. While the nonresidential side of the industry performed significantly better over the past year, even that segment’s momentum has started to wane. Nonresidential specialty trade contractors, demand for which led the industry in 2025, posted its worst month in nearly four years, losing 8,900 jobs in December.

“Despite this dismal performance, the industry’s unemployment rate remains relatively low, down 0.2 percentage points from the same time last year,” said Basu. “This unusual dynamic—decreasing employment but a steady unemployment rate—likely reflects the effects of immigration policy on the industry’s workforce. As a result, average hourly earnings for production and nonsupervisory construction workers were up 4.5% on a year-over-year basis in both November and December, a sharp increase from the 3.9% increase observed in October. While contractors remain optimistic about hiring over the next six months, according to ABC’s Construction Confidence Index, recent declines in backlog, ongoing declines in construction spending and December’s job losses suggest it could be a difficult start to 2026 for the industry.”

By Luiza Mills, Interstate Electrical Services Corporation 

As we begin the new year, we are ready to start a new chapter. But at the same time, we need to remain informed and maintain focus on ongoing challenges.

Among the most recent are that President Biden’s project labor agreement (PLA) mandate is still in place at the federal level and Gov. Healey has issued an executive order directing state agencies to consider PLAs, rigid state construction ratios impede hiring, and signs point to a slowing economy.  In uncertain times like these, it’s more important than ever to be part of a strong community that understands and is unified in supporting you.   

That’s what makes accomplishments like our Chapter’s recent membership drive that brought in an impressive 25 new members even more important than usual.  Growing our membership expands the community we can tap into as a resource. It also continues to grow and support our future and strong partnerships. 

ABC MA provides members with strong representation on Beacon Hill that has largely maintained our access to projects despite being outspent and often misrepresented.   As ABC MA lobbyist John Bartley so often says, “If you’re not at the table, you’re on the menu.” 

We also provide professional public relations support that has led to the Boston Globe and other major Massachusetts media outlets supporting our positions on important issues like PLAs.

We don’t need to tell you that workforce development remains a top priority in our industry.  The Gould Construction Institute’s new training facility has dramatically enhanced our ability to attract, inform and educate young talent, as has Building Mass Careers, our workforce development-focused non-profit.  BMC operates an apprenticeship program that provides members with access to public projects and has attracted significant grant funding that it uses to recruit people to the construction industry and provide them with training.

In times like these, ABC MA’s voice remains strong and our members united.  As we face myriad challenges in the new year, we remain committed to you and look forward to ongoing support. 

The construction industry added 19,000 jobs on net in September, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data. On a year-over-year basis, industry employment has grown by 38,000 jobs, an increase of 0.5%.

Nonresidential construction employment increased by 16,300 positions, with gains in all three subcategories. Nonresidential specialty trade added 11,100 jobs, while heavy and civil engineering and nonresidential building added 4,900 and 300 jobs, respectively.

The construction unemployment rate increased to 3.8% in September. Unemployment across all industries increased from 4.3% in August to 4.4% last month.

“Construction employment increased in September, ending a streak of three consecutive monthly declines,” said ABC Chief Economist Anirban Basu. “Despite the rebound, the industry has added just 2,000 jobs since March. While weakness is largely concentrated in the residential segment, with nonresidential employment growing at a modest pace over the past year, recent construction spending data suggests that activity in the nonresidential segment is beginning to contract as well.

“Even with the industry’s paltry job growth in 2025, the construction unemployment rate remained relatively low in September at 3.8%,” said Basu. “While that dynamic—tepid hiring but stable unemployment—indicates a lack of labor force growth, construction wages grew at a healthy pace for the month, suggesting that labor shortages are no longer putting significant upward pressure on labor costs.

“Contractors remain confident that hiring will pick back up over the next six months,” said Basu. “Nearly half of ABC members expect their staffing levels to increase over the next six months, while fewer than 12% expect them to contract, according to ABC’s Construction Confidence Index. Because the BLS will not publish October employment data due to the government shutdown, the industry won’t have another assessment of its labor market health until the November data are published on Dec. 16.”