By KEN SIMONSON

Construction employment, not seasonally adjusted, rose year-over-year (y/y) from May 2025 to May 2026 in 152 (42 percent) of the 360 metro areas – including divisions of larger metros for which the Bureau of Labor Statistics posts construction employment data – fell in 161 (45 percent) and was unchanged in 47, according to an analysis AGC released  July 2.

Houston-Pasadena-The Woodlands, Texas added the most construction jobs (12,100 jobs or 5 percent), followed by St. Louis, Mo.-Ill. (10,500, 13 percent) and Baton Rouge, La. (8,400, 18 percent). The largest percentage gain occurred in Baton Rouge, followed by 13 percent increases in Mobile, Ala. (1,800 jobs); Davenport-Moline-Rock Island, Iowa-Ill. (1,400 jobs); and St. Louis.

The largest decrease was in Riverside-San Bernardino-Ontario, Calif. (-6,100 jobs, -5 percent), followed by Portland-Vancouver-Hillsboro, Ore.-Wash. (-5,200, -7 percent) and Sacramento-Roseville-Folsom, Calif. (-4,400, -6 percent). The largest percentage loss occurred in Lawton, Okla. (-21 percent, -400 jobs), followed by Monroe, Mich. (-9 percent, -200 jobs) and Niles, Mich. (-9 percent, -200 jobs).

For the first five months of 2026 combined – compared to January-May 2025 – the value of construction starts, not seasonally adjusted, climbed 6.4 percent year-to-date (YTD), ConstructConnect reported July 3. Nonresidential building starts jumped 19 percent YTD, with commercial up 74 percent (led by a 244 percent leap in combined office and data center starts), institutional up 16 percent and industrial (manufacturing) down 61 percent. Engineering (civil) starts rose 15 percent YTD, with roads up 2.2 percent, water and sewage treatment up 19 percent, bridges up 12 percent, electric power infrastructure up 2.7 percent and airports down 36 percent.

Residential starts slumped 20 percent YTD, with single-family down 23.5 percent and apartments down 15.5 percent.

“Despite the lack of headlines, opportunities abound for those not involved with data centers or megaprojects,” ConstructConnect Chief Economist Michael Guckes said. “Several subcategories have experienced explosive growth thus far in the year that are outside of the data center ecosystem of work – which, in addition to the data centers themselves, includes construction related to power generation, power infrastructure and water, sewage and treatment.”

Outside of this ecosystem, the fastest-growing subcategories YTD are military spending, up 62 percent; hospitals and clinics, up 31 percent and shopping, up 16 percent.

The Architecture Billings Index slipped to 44.5 in May, seasonally adjusted, from 48.3 in April, the American Institute of Architects reported on July 1. The index is a leading economic indicator that leads nonresidential construction activity by approximately 9-12 months. The ABI is derived from the share of responding architecture firms that report a gain in billings from the previous month less the share reporting a decline, on a 0-to-100 scale. Scores below 50 indicate decreasing business conditions. Subindexes (based on three-month moving averages) varied for practice specializations: multifamily residential, 49.2 (down from 51.5 in April); institutional, 46.9 (down from 51.1); commercial/industrial, 45.5 (down from 48.9); and mixed practices, 44.1 (up from 42.5).

“The uncertainty created by the Iran conflict, and substantially higher energy costs, weighed on architect billings,” said American Institute of Architects Chief Economist Richard Branch. “Higher interest rates, rapidly rising material costs and continued labor shortages all contributed to softer demand.”

Based on its survey data, contractors are projecting 2026 construction staff wages to increase an average of 3.94 percent (excludes 0 percent projections), reported by 335 companies in this 44th edition of the Construction/Construction Management Staff Salary Survey. Typically, projected increases – as of February – are 0.3 percent to 0.5 percent higher by year end, so there is a chance pay will end the year slightly higher.

For pay increase comparison – according to WorldatWork – across all industries, exempt professionals saw 2025 increases of 3.6 percent with initial projected 2026 increases of 3.6 percent. Increases in 2025 among surveyed firms averaged 4.4 percent for construction staff and 3.6 percent for all exempt salaried employees.

Between April 1, 2020, and July 1, 2025, the South grew by 6.0 percent, nearly double the nation’s 3.1 percent population growth, the Census Bureau reported on July 2. It was the only region to see population growth in all five age groups, outpacing the other regions within each age group.

Of particular interest to contractors looking for potential job entrants, the Northeast was the only region to lose young adult (18-24) population (-2.1 percent). This age group increased by 2.1 percent nationally, 0.8 percent in the West, 1.9 percent in the Midwest and 5.0 percent in the South.

Click here for the AGC’s latest Data Digest.