Good news, bad news: The government is back open, but the data doesn’t look so good for construction.

What We Learned in November: Dismal Industry Data Trickles in as Government Reopens

The government reopened on Nov.12. Based on the few public-sector data releases that have occurred since the reopening, the construction industry continues to struggle. Nonresidential spending contracted again in August, industrywide job growth remains sluggish, and materials prices appear to be trending higher. Despite this, contractors remain relatively confident about the outlook while backlog remains at a healthy level.

Construction Job Growth Rebounds in September

The construction industry added 19,000 jobs in September, ending a three-month streak of employment declines. Job losses have been concentrated on the residential side of the industry. Nonresidential hiring, while better than the residential side of the industry, has been strictly modest in 2025 even with September’s healthy gain. Despite slow employment growth, the industry unemployment rate remains low, suggesting that the labor supply remains constrained.

Construction Spending Contracts

Nonresidential construction spending shrank for the third time in the past four months in August and is now down about 2.4% from the all-time high reached in December 2023. While few segments have momentum, the downturn in manufacturing-related construction activity has been particularly sharp. With tariffs and uncertainty weighing on several subsegments and megaprojects made possible by the CHIPS Act coming to an end, nonresidential spending may continue to contract in the coming months.

Construction Backlog and Confidence Slip in October, Contractors Remain Upbeat

ABC’s Construction Backlog Indicator fell to 8.4 months in October, down 0.1 months from September but unchanged from one year ago. While contractor confidence declined slightly for the month, contractors continue to expect their sales, profit margins, and staffing levels to improve over the next six months. 

Materials Prices Have Risen in 2025

Construction materials prices, which were largely unchanged in 2024, have started to rise again in 2025. This is especially true for materials subject to higher tariffs like iron and steel. Industrywide materials prices were up just 2.3% year over year in August, although it should be noted that many of the steepest tariffs did not go into effect until the start of that month. The extent to which tariffs are pushing input prices higher should be more apparent when September Producer Price Index data is released on Nov. 25.

Looking Ahead

There won’t be an employment report for October, and November employment data won’t be published until the middle of December. As of this writing, the Census Bureau hasn’t determined when it will release newer construction spending data. Which is to say, even with the government reopened, it may be some time before we regain a typical level of understanding about the industry’s economic performance.

SEE ALSO: PRE-SHUTDOWN NONRESIDENTIAL CONSTRUCTION SPENDING DOWN IN AUGUST