30 High-Profile Special Feature: Built Leadership Forum November 2026

By Ken Simonson

New England contractors are working in a national economy that is growing slowly and unevenly, and the region is feeling the uneven part more than most. Nationally, nonresidential construction employment rose 2.8 % in the year through August while residential slipped 0.6 %, and 35 states plus the District of Columbia added construction jobs. The Northeast was largely absent from the winners’ column.

New Hampshire posted the steepest percentage decline in the country over that 12-month stretch, down 3.7 %, with Rhode Island close behind at 3.1 % and New Jersey at 2.3 %. Massachusetts had been a bright spot through early summer, adding 3,700 jobs from June 2025 to June 2026, one of the largest gains in the nation. Then it shed 1,400 positions between July and August. Vermont held flat. The regional labor market reflects a pattern I call“ low hire, low fire”: openings and hiring are subdued, layoffs remain rare, and firms are keeping the people they have because replacing them is so difficult.

Construction job growth by state,

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August 2025 – August 2026 / Graphic courtesy of AGC of America

Two forces make that difficulty worse. The first is pay. Average hourly earnings for construction workers nationally climbed 5 % over the past year, against 3.3 % for the private sector as a whole, and Massachusetts already ranks among the four highest-paying states for construction labor. The second is immigration. Thirty-five percent of construction trade workers nationwide are foreign-born, and in drywall, roofing, and painting the share exceeds half. Across the Northeast the picture varies enormously: New Jersey sits near the top at 49 %, while Vermont and New Hampshire are at the very bottom at 1 % and 4 %. Stepped-up enforcement will hit hardest where crews depend on immigrant labor and will tighten an already thin pool everywhere else.

Costs are the other half of the story. Total construction spending nationally fell 3.8 % to $ 2.16 trillion in the year through July, with private residential down 7.3 % and private nonresidential off 3.3 %. Meanwhile the producer price index for nonresidential construction inputs jumped 8.9 %, more than two and a half times the increase in consumer prices. Tariffs are doing much of the damage. Steel mill products are up 23 %, aluminum 27 %, and copper 21 %, and diesel has surged 78 % amid conflict in the Middle East. New England’ s proximity to Canadian suppliers makes the lumber and cement duties especially consequential: the levy on Canadian lumber was raised to 35 % last year, and a 50 % tariff on Canadian cement took effect in August before being suspended in September. Owners who can wait are waiting.

So where is the growth? Nationally, data center construction is up 57 % year over year, power 5 %, and highways 4 %, while manufacturing plants dropped 21 % and warehouses, retail, lodging, and conventional office space all contracted. Several of my best bets for the next few years play to this region’ s strengths: specialty health care, airports, and the generation and transmission capacity needed to serve new electrical load.

My medium-term outlook is slow growth with a genuine risk of stalling. Expect materials to run 3 % to 6 % higher, considerably more if the Middle East conflict persists, and labor 4 % to 5 % higher. Warehouse and office work should stay soft through 2026. Single-family housing ought to recover gradually if mortgage rates hold, and multifamily appears close to a bottom. For contractors in Massachusetts and across New England, the practical response is to lock in materials pricing wherever possible, build escalation clauses into contracts, and keep investing in the workforce you already have. In this market, the people on your payroll are the asset hardest to replace.

Ken Simonson is the chief economist for the Associated General Contractors of America. www. high-profile. com