Building Supply Industry Outlook 2025
The past several years have been filled with ups and downs as it relates to the recruiting industry; as soon as we adjusted to one change, a new trend emerged and with it, new challenges.
As we start the New Year and reflect on the end of another, we’re optimistic about the state of the industry, especially what we see on the horizon in the building and construction sector. This industry, more than many, has been a rollercoaster ride, but in 2025… things are already looking up.
“The construction and manufacturing sectors can look forward to a gradually improving operating environment in 2025, thanks to lower interest rates, moderating inflation, and steady if unspectacular growth in the nation’s overall economic activity.”
Poised for growth in 2025
“The construction industry stands at a pivotal juncture as we look ahead to 2025. Despite facing a complex landscape marked by both challenges and opportunities, the sector is poised for growth.”
There are, of course, residual effects from the last few years that will continue to need attention, construction positions specifically still are experiencing a talent shortage – especially skilled workers and specialized laborers such as electricians and welders.
There is also the issue of an aging workforce: “An aging workforce presents another issue, with projections indicating that, by 2030, the average age of craft workers will be 46 years.17 Firms also face a perceived lack of interest among younger generations who possess different expectations when it comes to work and the working environment. This creates a unique challenge necessitating a balance between institutional knowledge that experienced employees bring and the new skills and perspectives of younger employees.”
Now is the time to build your team
All labor-related challenges considered, however, several positively trending factors are setting the scene for a year of growth and opportunity.
Consider that:Construction industry trends are inherently related to economic changes, including macroeconomic variables such as inflation, interest rates and the economy’s well-being, state and local policies, and population and economic trends.
What does this tell us? To start, inflation looks to be cooling and businesses everywhere are ready to take advantage. Paired with strong indications that interest rates will continue to come down, the environment is primed for increased investments.
According to the Deloitte analysis of the Oxford Economic Model, short-term interest rates are likely to decrease gradually over the next couple of years, following a 50-basis point interest rate cut by the Federal Reserve in September 2024. The improving economic conditions are likely to influence construction demand across various segments. Declining mortgage rates could boost demand and residential construction activity.
This welcomed news, paired with increased attention from government agencies promising efforts to support industry and improve logistics, further suggests good things are on the horizon.
Location, location, location
We also recommend keeping an eye on supply chains – yes, we know, we said those two words out loud – but what may be different in 2025 is the logistics and a general push toward bringing production and proximity to consumers closer.
In addition to the logistics side of things, companies are also taking a closer look at intellectual property and the production country’s laws; this will be at the top of many CEO’s lists this year.
2025 = Tech, Manufacturing and Energy
It should come as no surprise that technology serves as the final piece of the puzzle to explain why industry experts are looking favorably upon the building industry in 2025.
Technology-specific advances in everything from AI, VR, heavy equipment, and safety are coming together to help maximize efficiency throughout all aspects of building and construction.
Companies are leveraging digital tools and AI to increase their capacity and capabilities, aiming to offset labor shortages by using these technologies to help optimize a portion of work hours.
Your workforce is still human in 2025
Fortunately, we predict being human will still be very popular in 2025… and you need to be ready to offer employees an overall compensation package that reflects their worth – many of whom are still feeling like their money isn’t stretching as far as it once did.
This year will no doubt bring a lot of change and a willingness of those with transferrable skills to… well, transfer them – whether that’s upward within your company or to another opportunity with a competitor is up to you; now is the time to set the right tone for the remainder of the year. Creating a healthy company culture never goes out of style.
Regardless of overall job openings, your competition hasn’t disappeared, making attracting the best talent crucial in 2025. What’s always on trend is meeting deadlines, exceeding expectations and making sure that your character counts. If you need an expert partner to help guide you through the year, we’re ready when you are but don’t wait too long because as we know the early bird gets the worm… or in this case exceeds quota.
