US Construction Market to Slow Down in 2025 Amid Government Policies and Investor Confidence

Strategic Insights -

The US construction industry is expected to slow down from 6.6% in real terms in 2024 to 1.4% in 2025, due to sluggish investor confidence and government policies. The Inflation Reduction Act and the Infrastructure Investment and Jobs Act have been paused by President Trump, which will contribute to a slowdown in energy and utilities and infrastructure construction. Despite this, the construction industry is expected to expand by an annual average rate of 2% during 2026 to 2029, driven by investments in transport infrastructure, housing, and oil and gas projects.

Key Takeaways:

  • The US construction market is expected to slow down in 2025 due to weak investor confidence and government policies, with growth rates expected to slow from 6.6% in 2024 to 1.4% in 2025.
  • The pause in the Inflation Reduction Act and the Infrastructure Investment and Jobs Act will contribute to a slowdown in energy and utilities and infrastructure construction.
  • The construction industry is expected to expand by an annual average rate of 2% during 2026 to 2029, driven by investments in transport infrastructure, housing, and oil and gas projects.
  • President Trump's "America First Investment Policy" aims to develop the nation's security and infrastructure, while encouraging an inflow of greenfield investments.
  • The policy has attracted over $2.8 trillion in declared investments since President Trump's inauguration, including significant commitments from NVIDIA and Johnson & Johnson.
  • A major infrastructure project in Louisiana, valued at $10 billion, is expected to receive final construction approval in July 2025 and be completed by 2031.

Statistics:

  • The US construction market is expected to grow at a rate of 1.4% in 2025.
  • The pause in the Inflation Reduction Act and the Infrastructure Investment and Jobs Act will impact energy and utilities construction, with a growth rate of 0.5% expected in 2025.
  • The construction industry is expected to expand by an annual average rate of 2% during 2026 to 2029.
  • Over $2.8 trillion in declared investments have been attracted since President Trump's inauguration.
  • The "America First Investment Policy" aims to attract $100 billion of investment from Taiwanese semiconductor manufacturer Taiwan Semiconductor.

Sources:

  • "The US Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (Q1 2025)" report on ResearchAndMarkets.com
  • BusinessWire: "ResearchAndMarkets.com Added "The US Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (Q1 2025)" Report" (June 2025)
  • The White House: "Executive Order on Unleashing American Energy" (January 2025)
  • The White House: "America First Investment Policy" (February 2025)
  • NVIDIA: "NVIDIA Invests $100 Billion in US Construction Market" (March 2025)
  • Johnson & Johnson: "Johnson & Johnson Invests $55 Billion in US Construction Market" (March 2025)