United States Construction Industry Databook - Market Size & Forecast by Value & Volume, 40+ Market Segments Across Residential, Commercial, Industrial, Institutional, Infrastructure Construction, City Level Construction by Value and Construction Cost Structure, Q1 2025 Update

According to the report, the construction market in the United States is expected to grow by 5.6% on annual basis to reach USD 1.27 trillion in 2025.

The construction market in the country experienced robust growth during 2020-2024, achieving a CAGR of 7.3%. This upward trajectory is expected to continue, with the market forecast to grow at a CAGR of 4.4% during 2025-2029. By the end of 2029, the construction sector is projected to expand from its 2024 value of USD 1.20 trillion to approximately USD 1.59 trillion.

This report provides a detailed data-centric analysis of the construction sector in United States, offering a comprehensive view of market opportunities in the building and infrastructure construction industry at the country level. With over 100+ KPIs covering growth dynamics in building and infrastructure construction, construction cost structure analysis, and analysis by key cities in the country, this databook provides a wealth of data-centric analysis with charts and tables, ensuring stakeholders are fully informed.

It offers a comprehensive analysis of market dynamics in the construction sector through a range of KPIs such as value, volume, and number of units. The building construction covers detailed segmentation over 30+ segments in residential, commercial, industrial, and institutional sectors.

The analyst's research methodology is based on industry best practices. Its unbiased analysis leverages a proprietary analytics platform to offer a detailed view of emerging business and investment market opportunities.

Key Insights

United States Residential Construction Industry

The convergence of digital innovation, sustainable design, and strong market demand creates significant opportunities for growth in residential construction. Strategic investments in advanced technologies and workforce development are poised to yield competitive advantages. This dynamic environment presents a promising landscape for expansion and modernization across key housing markets. However, persistent inflation, labor shortages, and regulatory hurdles remain major challenges that require agile responses. Market uncertainties, such as potential interest rate hikes, necessitate robust risk management and adaptive financing strategies. Addressing these challenges is critical to maintaining long-term project viability and industry stability.

Macroeconomic Factors

• Rising material and labor costs, driven by persistent inflation, are reshaping project budgets in key housing markets such as California and Texas. Developers are increasingly challenged by fluctuating interest rates and supply chain disruptions that force them to reexamine financing strategies. These economic pressures are prompting a more cautious approach to budgeting and long-term planning.
• There is a robust demand for sustainable and energy-efficient housing as trends like smart home technologies and modular construction gain traction. The industry is witnessing a significant shift as consumers prioritize eco-friendly homes and modern amenities. This trend reflects market demand and influences design and construction practices.
• At the same time, labor shortages and local regulatory challenges, including zoning restrictions, continue to pose hurdles for the industry. Market uncertainties, such as potential interest rate hikes, add further risks to long-term project viability. These challenges underscore the need for agile strategies and proactive risk management in residential construction.

Project Landscape

• Numerous large-scale residential developments are underway in metropolitan areas like New York and Los Angeles, catering to affordable and luxury housing segments. These projects are redefining urban skylines with innovative designs and high-density living concepts. Developers are also exploring new market opportunities to meet evolving demographic needs.
• In addition, innovative mixed-use projects that blend residential, retail, and recreational spaces are emerging in secondary markets. These developments aim to create vibrant communities that offer a balanced lifestyle. Such projects often combine multiple revenue streams and reflect a holistic approach to urban planning.
• The market is primarily driven by private developers, with local affordable housing programs and public-private partnerships (PPPs) supporting it. Recent state-level budget allocations and federal incentives have bolstered funding for these projects. Consequently, investors remain optimistic as steady capital inflows from domestic and international sources support continued growth.

Government Policies & Programs

• Federal programs like the HOME Investment Partnerships Program and various state-level affordable housing initiatives are actively driving market activity in the residential sector. These initiatives highlight the government's commitment to addressing the housing shortage and promoting sustainable growth. In turn, local governments prioritize policies that streamline permitting processes and facilitate rapid development.
• Subsidies and incentives have been introduced to support these efforts, including tax credits for energy-efficient construction and low-interest loans for first-time homebuyers. Recent regulatory reforms aim to reduce bureaucratic delays and expedite project approvals. These measures help lower costs and encourage more developers to enter the market.
• Federal policies provide broad housing goals, while state and municipal authorities tailor programs to meet local market needs. Coordination across government levels ensures that investments are aligned with regional priorities. This multi-layered approach creates a supportive environment that fosters innovation and drives long-term growth in residential construction.

Industry-Specific Developments

• Technological advancements such as Building Information Modeling (BIM), prefabricated construction, and smart home systems significantly enhance project efficiency and quality. Digital tools enable real-time project management and tighter cost control, allowing more accurate scheduling and budgeting. These innovations are transforming traditional construction methods into more agile, technology-driven processes.
• Sustainability initiatives have become a core focus, with LEED certifications and other green building standards increasingly becoming the norm. Energy-efficient designs and integrating renewable energy sources are key selling points for new developments. This shift toward green building practices meets regulatory requirements and appeals to environmentally conscious homebuyers.
• Despite these positive developments, the industry faces a skilled labor shortage that challenges project timelines and quality. To address this gap, increased investments are being made in vocational training and apprenticeship programs. Enhanced workforce development initiatives are essential for adapting to new technologies and ensuring the sector's long-term success.

United States Commercial Construction

The shift toward flexible, technology-driven commercial spaces presents substantial opportunities for modernization and growth. Strategic investments in smart infrastructure and sustainable design will yield long-term benefits. This evolution creates a promising landscape for developers and investors looking to capitalize on emerging trends. Despite these opportunities, economic uncertainties, regulatory complexities, and changing tenant expectations remain persistent challenges. Stakeholders must remain agile and responsive to evolving market conditions and technological disruptions. Effective risk management and adaptive financing strategies are crucial to navigate these obstacles.

Macroeconomic Factors

• Rising costs for materials and labor are significantly impacting commercial project budgets across major urban centers. Economic uncertainty drives construction expenses, challenging firms to keep projects within budget. These pressures necessitate a reexamination of traditional cost structures and financing models.
• Interest rate volatility prompts companies to adopt more conservative financing strategies amid fluctuating economic conditions. Firms are increasingly cautious about long-term debt and are exploring alternative funding sources. This cautious approach reflects broader concerns about economic stability in key markets.
• Shifts in market dynamics have also spurred evolving trends in commercial construction. As remote work and e-commerce reshape urban landscapes, there is a growing demand for modern office spaces, retail centers, and mixed-use developments. However, economic fluctuations and shifting consumer behaviors create operational risks, while increased competition and regulatory complexities add further challenges.

Project Landscape

• High-rise office developments in cities such as Chicago and San Francisco are being modernized to meet current tenant demands. These projects incorporate updated designs and technology to attract a new generation of commercial tenants. Ongoing initiatives are reshaping traditional office spaces to align with evolving market needs.
• Retail and mixed-use projects in suburban areas are being reimagined to offer flexible, community-oriented spaces. Developers integrate lifestyle amenities with work and retail environments to create vibrant, multi-functional developments. This trend reflects the growing desire for spaces that cater to diverse urban experiences.
• The commercial sector is predominantly driven by private investment, although municipal support plays a key role in urban revitalization efforts. Select public initiatives target the redevelopment of economically distressed areas, often through public-private partnerships. Significant capital commitments from institutional investors and REITs, bolstered by federal and state incentives, continue to signal robust growth.

Government Policies & Programs

• Urban redevelopment programs and local economic stimulus plans actively support commercial construction projects. These initiatives bring new life into aging urban centers and promote sustainable growth. Local governments are increasingly focused on using these programs to attract new investment.
• State-level initiatives such as tax abatements and zoning reforms are tailored to attract private investment. Recent regulatory updates have streamlined permitting processes, significantly reducing project lead times. Financial incentives, including grants and low-interest financing options, are available for projects incorporating sustainable design elements.
• Federal policies provide a broad framework for urban development, while state and local governments offer tailored solutions to address regional challenges. This multi-tiered approach facilitates coordinated development efforts across diverse markets. The combined effect of these policies creates a supportive environment that encourages investment in commercial construction.

Industry-Specific Developments

• Adopting IoT, smart building systems, and advanced security technologies enhances operational efficiencies in new commercial projects. Developers are leveraging these technological advancements to reduce energy consumption and improve building performance. Virtual design and construction (VDC) tools further stream collaboration and reduce overall construction time.
• As many developments target LEED certification, energy efficiency and environmental responsibility are becoming key determinants in project design. Renewable energy integration and water conservation measures are increasingly incorporated into commercial builds. These sustainability initiatives meet regulatory requirements and reduce long-term operational costs.
• In response to these technological shifts, the commercial sector invests in training programs to address the skills gap in digital construction and facilities management. Demand for specialized talent in smart building integration is rising, prompting new workforce development initiatives. Such efforts are essential to ensure that the industry remains competitive and innovative.

United States Institutional Construction

Modernizing institutional facilities presents significant opportunities to enhance public service delivery and boost community engagement. Strategic investments in digital transformation and energy-efficient technologies can yield long-term benefits and foster sustainable growth. This evolving landscape creates a promising environment for both public and private stakeholders. However, funding limitations, bureaucratic inertia, and evolving regulatory demands remain substantial obstacles. Navigating these challenges requires innovative financing models and collaborative project management approaches. Effective risk management is crucial to mitigate the uncertainties associated with these projects.

Macroeconomic Factors

• Budget constraints and rising material costs are significantly pressuring institutional projects in education, healthcare, and public services across the U.S. Fiscal pressures at both state and local levels influence project timelines and funding availability, making financial planning more challenging. These economic pressures require developers to adopt more stringent cost-management strategies.
• Modernization of institutional facilities is a primary focus, driven by the need for digital transformation and enhanced service delivery. A growing trend toward multi-use campus designs seamlessly combines educational, healthcare, and community services. This evolution reflects the increasing demand for modern, efficient infrastructure.
• Funding uncertainties, bureaucratic delays, and competing budget priorities can considerably slow project progress. Moreover, reliance on public funding and donor contributions adds additional planning complexities and risk factors. These challenges necessitate a robust risk management approach to ensure project viability.

Project Landscape

• Major hospital expansions and the construction of new educational campuses are underway in states like California and New York, aiming to modernize outdated facilities. These projects are designed to meet the increasing demand for high-quality public services and to address long-standing infrastructure gaps. Focusing on new developments is critical to driving long-term improvements in institutional delivery.
• Rehabilitation of older public service buildings is being prioritized to bring them up to modern standards and regulatory requirements. Such refurbishments preserve valuable community assets and enhance service delivery and operational efficiency. This strategy supports community revitalization and sustainable infrastructure development.
• Public entities predominantly fund institutional construction, with targeted private investments flowing through public-private partnerships. Collaborative efforts between federal, state, and local governments further bolster these projects. Steady increases in state budgets and federal stimulus initiatives underpin the strong investment outlook.

Government Policies & Programs

• Federal initiatives, such as increased healthcare modernization and educational infrastructure funding, are propelling institutional projects nationwide. These initiatives underscore the federal commitment to upgrading public facilities and addressing service delivery gaps. In parallel, state-led programs focus on long-term capital improvements tailored to local needs.
• Local governments are prioritizing streamlined permitting and regulatory reforms to expedite project delivery. These policies help reduce bureaucratic delays and align projects with community development goals. Tailored solutions at the state and municipal levels ensure that investments are effectively targeted.
• Grants, low-interest loans, and tax incentives - especially for energy-efficient projects - are available to support institutional construction. Recent regulatory reforms have further streamlined procurement processes and reduced administrative barriers. The multi-tiered government support framework, with federal guidelines complemented by local execution, creates a robust environment for institutional investments.

Industry-Specific Developments

• Integrating smart campus technologies, digital classrooms, and telemedicine capabilities fundamentally transforms institutional facilities. These technological advancements drive operational efficiencies and enhance the quality of services delivered. Advanced project management tools and Building Information Modeling (BIM) are now standard, improving design precision and reducing overall costs.
• Sustainability is taking center stage, with energy-efficient designs and sustainable materials being increasingly prioritized. Many new projects aim for certifications like LEED to demonstrate their commitment to environmental stewardship. This trend helps meet regulatory standards and reduces long-term operational expenses.
• The sector is experiencing a growing demand for professionals skilled in modern construction techniques and digital facility management. Training programs and partnerships with technical schools are being established to bridge the skills gap. These initiatives are essential for ensuring that the workforce is equipped to handle institutional construction's evolving technological and operational demands.

United States Industrial Construction

The rapid expansion of e-commerce and reshoring trends presents significant growth opportunities in the industrial sector. Investments in automation and digital transformation offer the potential for improved efficiency and reduced operating costs. These trends are creating a dynamic environment that encourages innovation and increased productivity.

Ongoing inflation, supply chain disruptions, and regulatory complexities pose persistent risks to industrial projects. Addressing these challenges requires robust risk management strategies and strategic agility from industry stakeholders. Effective management of these uncertainties is critical for maintaining project timelines and controlling costs.

Macroeconomic Factors

• Industrial construction faces rising costs for materials and labor amid ongoing inflationary pressures in the U.S. Tariff adjustments and global supply chain disruptions further influence project budgets and margins. These factors have compelled industry players to adopt more conservative financial strategies.
• The growth of e-commerce, automation, and reshoring of manufacturing is driving demand for new industrial facilities and upgrades. Companies increasingly invest in modern infrastructure to remain competitive, focusing on scalable and flexible spaces. This trend reshapes the industrial landscape as businesses update legacy systems to support digital transformation.
• Supply chain disruptions and workforce shortages create significant project timelines and cost control risks. Stringent environmental regulations and safety standards add complexity to project execution. As a result, robust risk management and strategic planning are essential to effectively navigate these challenges.

Project Landscape

• Expansion of distribution centers and new manufacturing plants in key logistics hubs such as the Midwest and Southeast are underway. Industrial parks and facility upgrades to support high-tech manufacturing and automation are rapidly emerging. These projects are critical to modernizing infrastructure and enhancing overall operational efficiency.
• Industrial projects are predominantly driven by private investments, with limited but strategic public sector involvement in designated economic zones. Public-private partnerships are vital in facilitating infrastructure improvements that support industrial activity. This collaborative approach helps bridge funding gaps and accelerate project development.
• Capital expenditure from multinational corporations and private equity remains robust, reflecting strong investor confidence. Economic forecasts and supportive government incentives are expected to drive continued industrial growth. This positive investment outlook is paving the way for significant developments and upgrades in the sector.

Government Policies & Programs

• Federal and state initiatives are focused on revitalizing manufacturing and supporting advanced industrial technologies through targeted grants and loans. Special economic zones and industrial corridors are actively promoted to stimulate regional industrial growth. These initiatives are designed to create a conducive environment for new investments in industrial construction.
• Tax incentives, expedited permitting, and regulatory relief measures are available for projects that invest in automation and sustainability. Such measures help mitigate operational costs and attract additional private investment. These financial and regulatory incentives streamline project approvals and accelerate development timelines.
• Federal policies set broad industrial revitalization goals, while state governments tailor programs to support local manufacturing clusters. Collaborative frameworks between government levels ensure that industrial projects receive consistent and coordinated support. This multi-tiered approach is essential for sustaining long-term industrial growth across diverse regions.

Industry-Specific Developments

• Integrating robotics, automation systems, and digital twin technologies revolutionizes industrial facility operations. Advanced monitoring and data analytics tools significantly enhance efficiency and enable predictive maintenance. These technological advancements are driving a new industrial innovation and operational excellence era.
• Energy-efficient building designs, waste recycling programs, and renewable energy integration are becoming essential features of modern industrial projects. Sustainability metrics are increasingly used to evaluate project success and secure investor confidence. This focus on green building practices reduces environmental impact and lowers long-term operational costs.
• There is a growing need for engineers and technicians with expertise in digital manufacturing and automation systems. Industry-led training initiatives and partnerships with technical colleges are being developed to address this skills gap. These efforts are crucial for ensuring a competitive workforce supporting advanced industrial operations.

United States Infrastructure Construction

Modernizing U.S. infrastructure presents vast potential to drive economic growth, enhance connectivity, and improve public safety. Strategic investments in digital innovation and sustainable practices offer the opportunity to unlock long-term value. This evolving landscape creates an environment ripe for transformative projects that benefit communities and the economy. However, high capital requirements, regulatory complexities, and political uncertainties remain significant challenges. Effective risk management and agile project execution are critical to overcoming these hurdles. To ensure successful project outcomes, stakeholders must be prepared to navigate complex financial and regulatory environments.

Macroeconomic Factors

• Escalating costs for raw materials and financing significantly impact large-scale infrastructure projects across the U.S., from highways to bridges. Currency fluctuations and global commodity trends continue to influence overall project budgets. These factors have led to tighter budget planning and more cautious investment approaches.
• A renewed focus on modernizing aging infrastructure is evident, spurred by the Infrastructure Investment and Jobs Act and other federal initiatives. This legislative momentum drives efforts to upgrade critical transportation, energy, and water systems nationwide. The industry is increasingly oriented toward long-term modernization projects that promise enhanced operational efficiency.
• Long project timelines and political and bureaucratic challenges often delay project execution. Funding gaps and the complexity of coordinating multi-jurisdictional projects add additional risks that stakeholders must manage. These macroeconomic pressures underscore the need for robust risk management and strategic financial planning.

Project Landscape

• High-profile projects such as highway expansions, bridge rehabilitations, and urban transit upgrades are underway in major cities like Los Angeles, New York, and Chicago. These initiatives aim to improve connectivity and reduce congestion in urban centers. Energy infrastructure projects, including grid modernization and renewable integration, are prominent nationwide.
• Infrastructure projects are primarily government-funded, but many public-private partnerships are emerging to share costs and risks. Donor and private investments are supplementing public capital, particularly in economically strategic regions. This blended approach is critical to accelerating project delivery and ensuring sustainable investment.
• Significant budget commitments from federal and state governments, supported by the latest infrastructure legislation, drive a robust investment outlook. The investment pipeline remains strong, fueled by political support for modernization efforts. This optimistic financial environment provides a solid foundation for infrastructure development.

Government Policies & Programs

• The Infrastructure Investment and Jobs Act has set a clear roadmap for nationwide modernizing transportation, energy, and water systems. This landmark legislation is catalyzing major investments in critical infrastructure projects nationwide. In addition, several state-level initiatives further support local infrastructure needs through tailored investment programs.
• Incentives designed to promote public-private partnerships and streamlined regulatory processes are accelerating project delivery. Tax incentives and matching funds programs are available to attract private sector involvement, helping offset the high costs of large-scale projects. These measures reduce barriers to investment and encourage innovative project financing.
• Federal strategies provide overarching goals and significant funding, while state and local governments implement projects that address regional requirements. This multi-tiered policy framework ensures cohesive and coordinated infrastructure development across diverse regions. Collaborative efforts across government levels are essential to maximizing the impact of available resources.

Industry-Specific Developments

• Advanced project management software, digital twins, and 3D modeling techniques are being deployed to enhance the planning, execution, and maintenance of infrastructure projects. These technological advancements improve accuracy and reduce delays during project implementation. Smart infrastructure systems are increasingly used for real-time monitoring and efficient asset management.
• A growing emphasis on resilient design, renewable energy integration, and green construction practices is driving a shift toward more sustainable infrastructure. Projects frequently incorporate environmental impact assessments and climate adaptation measures to ensure long-term viability. This trend is crucial for meeting regulatory requirements and investor expectations for sustainable development.
• A rising demand for specialized project management and engineering skills is prompting significant investments in workforce training programs. Collaborative efforts with academic institutions are helping to build a talent pipeline equipped for modern infrastructure challenges. These initiatives ensure the industry can support rapid technological adoption and evolving project requirements.

Report Scope

This report provides market size and forecast across 40+ construction segments for ten years from 2019-2028 in United States. KPIs covered include the following:

• Market size by value
• Market size by volume of construction
• Number of units

United States Economic Indicators

United States Top Cities Construction Data

United States Residential Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Housing type (multi family, single family)
• Key cities (Tier - 1, Tier - 2, Tier - 3 segmentation)
• Price point/income level (luxury, mid-tier, affordable)
• Construction stage (new construction, re-development & maintenance)

United States Residential Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Green building by Housing type (multi family, single family)
• Green building by Key cities (Tier - 1, Tier - 2, Tier - 3 segmentation)
• Green building by Price point/income level (luxury, mid-tier, affordable)

United States Commercial Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Office (further broken down by Grade A, Grade B, and Grade C)
• Retail (further broken down by Grade A, Grade B, and Grade C)
• Hospitality (further broken down by Grade A, Grade B, and Grade C)
• Restaurant (further broken down by Grade A, Grade B, and Grade C)
• Entertainment
• Sports facility
• Other commercial building construction
• Construction stage (new construction, re-development & maintenance)

United States Commercial Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Office green building construction
• Retail green building construction
• Hospitality green building construction
• Restaurant green building construction
• Entertainment green building construction
• Sports facility green building construction
• Other commercial green building construction

United States Industrial Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units):

• Manufacturing Plants building construction
• Chemical & Pharmaceutical building construction
• Metal & Material Processing building construction
• Construction stage (new construction, re-development & maintenance)

United States Institutional Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Healthcare construction
• Educational construction
• Other building construction
• Construction stage (new construction, re-development & maintenance)

United States Institutional Green Building Construction Coverage: 10-year market size & forecast in value and volume (area and units) terms by:

• Healthcare green building construction
• Educational green building construction

United States Infrastructure Construction Sectors: 10-year market size & forecast in value terms by:

• Marine and inland water infrastructure
• Utility system construction (oil and gas infrastructure, communication infrastructure, power infrastructure, water and sewer infrastructure)
• Transportation infrastructure (highway, street and bridge construction, railway construction, airport construction, and tunnel construction)
  
• Construction stage (new construction, re-development & maintenance)

United States Green Infrastructure Construction: 10-year market size & forecast in value terms

United States Construction Cost Structure Analysis: 10-year market size & forecast in value terms:

• Cost Analysis by Type (Material, Labour, Equipment, Others)
• By Material & Work Cost: It provides the cost outlook of material costs by type of materials used in construction (Cement, Steel, Sand, Aggregates, Bricks, Wood, Windows Glazing, Flooring, Plumbing, Electrical, Painting, Other Materials)
• By Labour Cost: It provides the cost outlook of labour costs (RCC Construction Work, Masonry and Plastering Work, Plumbing Work, Water Proofing Work, Carpentry Work, Electrical Work, Tile Fixing Work, CATV Antenna Points, Painting Work, Departmental Labour)
• By Type of Construction (New, Re-Development)
• By Material Cost: It provides the cost outlook of material costs by type of materials used in construction (Concreting Sand, Stone Aggregate, Ordinary Portland Cement, Reinforced Concrete (Grade 30 MPA), Reinforced Concrete (Grade 40 MPA), High Tensile Steel bars, Mild Steel Round Bars, Structural Steelwork, Plywood Formwork (1800*900*12mm), Clay Bricks)
• Type of Labour (Skilled vs. unskilled)

Reasons to Buy

• Comprehensive Insight into Construction Market Dynamics: Gain a deep understanding of the construction market, including opportunities, industry trends, and key drivers across over 40+ market segments and sub-segments.
• Detailed Analysis of Construction Costs: Explore construction costs broken down by type, including material and labor costs. The report provides detailed information on costs by construction type and worker.
• Top Ten Cities Construction Value: Access valuable data on the construction market size for major cities, focusing on key city-level sectors.
• In-Depth Volume and Value Data: Obtain a thorough understanding of the market from both value and volume perspectives, covering historical data and forecasts by activity and units.
• Strategic Market-Specific Insights: Formulate targeted strategies by identifying growth segments and opportunities and assessing key trends, drivers, and risks within the construction industry.
• City-Level Trend Analysis: Get detailed trend analyses for tier-1, tier-2, and tier-3 cities, offering actionable insights for urban-focused strategies.