Skanska has released its Fall 2025 Construction Market Trends Report.
Leveraging its composite construction index, the report delivers in-depth analysis and critical insights into the current state of the construction industry, highlighting the impact of tariff exposure, labor shortages, policy uncertainty and sector performance.
"As we approach the end of the year, the United States construction market is shaped by both volatility and opportunity," said Steve Stouthamer, executive vice president of project planning of Skanska USA Building. "Despite ongoing challenges with material costs and labor availability, strong demand in high-growth sectors such as data centers, semiconductor facilities and pharmaceutical manufacturing is expected to drive momentum in the market as we move into 2026."
With experience across diverse sectors nationwide and globally, Skanska brings a unique perspective on emerging industry trends, with key report highlights including:
• Total construction starts were up 3.1 percent in September 2025 to a seasonally adjusted annual rate of $1.26 trillion, driven mainly by nonbuilding with modest gains in residential construction.
• Year-to-date starts increased 3.5 percent compared to 2024. Nonresidential building starts declined by 6.2 percent in September but are up 5 percent year-over-year.
• Construction costs remain volatile, especially for key materials like steel, metals and lumber.
• The current administration has announced a blanket 10 percent tariff on all lumber imports, effective Oct. 14, 2025, which early estimates suggest will have limited immediate impact on lumber pricing.
• Copper pricing has stabilized after collapsing in July, when it was announced that exemptions were included in the refined and scrap copper tariffs, which make up more than 80 percent of annual copper imports.
• Structural steel pricing continues to move slowly and steadily upward, including recent increases of $35/ton on wide flange steel and $60/ton on plate steel, with increased lead times of 14-18 weeks.
• Aluminum prices continue to push record highs. Nickel prices are down and have stabilized.
• Overall pricing remains elevated due to sustained demand from high-tech sectors such as data centers, semiconductor fabrication and other copper-intensive construction.
• In August 2025, construction unemployment was 3.2 percent, with a drop of 7,000 jobs over the month driven mainly by decreases in nonresidential construction.
• Industry employment has grown only 0.7 percent year-over year. A persistent labor shortfall, estimated at approximately 450,000 workers, continues to pressure wages, which may rise to retain talent. Data centers continue to see strong demand, fueled by Ai and cloud computing expansion.
• Similarly, semiconductor and pharmaceutical manufacturing benefit from federal incentives and reshoring trends, positioning them for robust investment in the near term. This increase in demand is straining structural steel mill capacity, resulting in longer lead times and contributing to elevated copper prices.
For more information, visit skanska.com.
