Construction Trend Tuesday covers one (hopefully) interesting industry trend in a quick, two-minute read. You can access the archive of CTT posts here.
Construction labor cost escalation cooled considerably from late-2022 to late-2024, but that trend is now firmly behind us. Average hourly earnings for non-managerial construction workers are now up 5.0% year over year.
That—stop us if you’ve heard this one before—is largely due to data centers. Specialty trade contractors are leading the labor-cost-escalation charge, with electricians (+7.3% year-over-year) at the vanguard.
There are other potential factors at play, like stricter immigration policy. The share of construction jobs unfilled is near a two-year high and right in line with 2019 (when construction workers were pretty hard to find). That’s what you’d expect to see if immigration policy was shrinking the industry’s workforce.
But you’d also expect to see faster wage gains outside of specialty trades, and we really haven’t (at least not yet). It’s possible that immigration policy is shrinking the workforce but activity is weak enough that it’s not dramatically impacting labor costs beyond AI-related segments.
What’s Next
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