US construction needs nearly half a million new workers
28 January 2025
To meet expected demand, the US construction industry needs to attract nearly half-a-million new workers to the industry, according to the Associated Builders and Contractors (ABC).
Construction workers walk towards a site. (Image: Adobe Stock)
The US-based trade organisation, with a membership of more than 23,000 builders and contractors, reported that 439,000 net new workers would be required to match expected activity this year, and around 499,000 new labourers will need to join the fold in 2026.
In total, ABC believes nearly one million new construction workers will be required in the next two years, setting up a staggering disproportion in what many expect will be a high-activity timeframe.
ABC Chief Economist Anirban Basu said, 鈥淚f [construction] fails to do so, industrywide labour cost escalation will accelerate, exacerbating already high construction costs and reducing the volume of work that is financially feasible.
鈥淎verage hourly earnings throughout the industry are up 4.4% over the past 12 months, significantly outpacing earnings growth across all industries,鈥� noted Basu.
Wages could increase even further, particularly if aggressive deportation policies by the Trump administration force legal migrant workers to seek employment elsewhere or in another industry.
鈥淧otential changes to immigration policy will likely constrain worker availability,鈥� noted Basu, who said that prior immigration figures were high, which helped bolster labour supply.
Still, Basu said this year鈥檚 forecast is an improvement relative to recent years.
He added, 鈥淭he improvement can be traced to two primary factors: First, construction spending is expected to grow at its slowest pace in years throughout 2025, especially in interest rate-sensitive segments like homebuilding. Second, the industrywide workforce has become significantly younger over the past several quarters, with the median construction worker now younger than 42 for the first time since 2011.鈥�
ABC said it will be working closely with federal officials to help find solutions to reduce gaps.
Michael Bellaman, ABC president and CEO, said the big picture was positive, but 鈥渨e still have a long way to go to shore up the talent pipeline.
鈥淭he data on the number of young people choosing a career in construction suggests that employing practical technology and innovation in educational programs and on jobsites helps maximise the productivity and efficiency of the construction workforce.
鈥淎BC鈥檚 all-of-the-above workforce development strategy is working to draw new entrants into the industry through hundreds of entry points and upskill them through both industry-driven and government-registered apprenticeship programs.鈥�
About ABC鈥檚 Construction Spending and Employment Forecast data
Graph courtesy Associated Builders and Contractors
ABC said it uses its own proprietary model to determine the figure. The organisation uses historical relationships between inflation-adjusted construction spending growth, sourced from the US Census Bureau鈥檚 Construction Put in Place Survey, and payroll construction employment, which is sourced from the US Bureau of Labor Statistics.
ABC then converts anticipated increases in construction outlays into demand for construction workers at a rate of approximately 3,550 jobs per billion dollars of additional spending. This model also incorporates the current level of job openings, unemployment and projected industry retirements and exits into its computations, ABC said.
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