ABC: Construction Industry to Face 'Real Risks' in 2026

NewsCompaniesWorkforce Economics ABC: Construction Industry to Face 'Real Risks' in 2026 By Alisa Zevin U.S. Bureau of Labor Statistics Material prices have risen significantly since the COVID-19 pandemic. December 10, 2025 Modest growth is expected in 2026, Anirban Basu, chief economist at Associated Builders and Contractors, said in a construction forecast webinar on Dec. 10. However, he said there are “real risks,” adding that “stubborn inflation [and] stubbornly high interest rates … will continue to suppress growth in construction spending.” High inflation and interest rates are “a drag on construction activity,” said Basu. “So one of the things we’ve seen over the course of the year is that the number of construction job openings has plummeted.” In a survey, webinar participants reported insufficient demand for construction services as their leading challenge, marking the first time “in recent memory” that a lack of skilled workers had not been the leading concern, Basu said. RELATED US Construction Materials Prices Rise 3.5% as Contractor Backlog Declines Inflation and tariffs have also driven significant price increases for some materials. In the time between the start of the COVID 19 pandemic in February 2020 and September 2025, overall construction input prices have risen 43.3%, with the most substantial increase a 63.1% boost to fabricated structural metal products, according to the U.S. Bureau of Labor Statistics. Steel mill products and nonferrous wire and cab...