The USA continues to be the most powerful country in the world, with its close to $30 trillion economy that powers its unsurpassed technology know-how, creativity, EPC knowhow & worldwide influence.

Falling US interest rates could benefit present an opportunity for new construction projects to move forward into 2025.

Latest news from the European Union is that they are reducing tariffs on US autos from 12.5% to 2.5%. This could trigger the construction of a number of multi-billion $ automobile plants across the US to meet this potential new market.

As much as 25% of construction workers are migrants, predominantly from Central America. It is believed that as much as 50% of these construction workers are not permitted / documented to work in the USA, this could be a major problem in the next 6 to 12 months with President Trump’s promise to remove undocumented migrants from the USA.

Construction of Data Centers, Semiconductor Fabrication Centers, High-Tech Micro-Chip production facilities and Call Centers primarily in the USA, with some activity as well in some European & Asian countries is extremely active, driven by the anticipated future needs of AI services.

US & Canadian labor shortages are a serious problem for the construction sectors. The US construction industry will need to recruit close to half a million new skilled & un-skilled construction workers in 2025 to replace retiring “baby-boomers” and to keep up with demand for new construction work.

Mexican & other Central America workers make up a significant portion of the construction labor workforce in the US. These workers account for as much as 25% to 35% of the construction workforce in some southern US states like Florida, with a substantial number of these workers coming from Mexico.

Specific construction material prices are forecast to increase by 3% to 5% in the next 6 months driven by the Trump Administration’s future tariffs on Canada, Mexico & China.

Mexico & Canada supply more than $25 to $28 billion worth of construction materials used in the US construction sector. Material such as structural steel, aluminum products, timber / framing & lumber products, plywood & drywall are widely used materials.

The possibility of less rules & regulations & easier permitting process is weighed up against possible tariffs & labor shortages.

Three months into the Trump Presidency, it appears that there will be less “red tape” which should make the construction permitting process easier.

USA construction costs that include material & labor costs have increased year to year on average by 3.4%, look for this rate to fall marginally as we transition into the 1st half of 2025. Construction material & labor costs have increased by 23% since 2020, which averages out to just less than 5% per year, across all USA geographic areas.

The pharmaceutical, bio, medical device (life sciences) construction sector has seen a slowdown in the last 9 months, look for this to continue well into 2025 as the sector reflects on what impact President Trump will have on this important sector.

The 2025 US / Canadian / Mexico Construction market is estimated to be in the $3.15 to $3.25 trillion range, an increase of 2.8% from 2024 (Year to Year), still the world’s largest construction market. In the USA and construction cost increases have returned to more customary levels since the conclusion of COVID in the range of 2.7% to 3.3%.

The US construction industry continues to face supply chain challenges, price spikes, longer delivery times for components such as MCC / switchgear, modules / specialized skids- pre-assemblies, large compressors, heat exchangers, certain key instrument devices, larger pumps, fabricated process piping, specialized pharmaceutical production equipment, HVAC / HEPA / equipment and filters.

Severe shortages of skilled construction labor such as Pipefitters, Welders, Electricians and Instrumentation technicians continue to be a serious problem to the US construction industry.

Canada’s construction market is projected to grow to C$275 billion by the end of 2025. Canada’s construction activity in the 2^nd Q of 2025 is forecast to expand marginally by 1.6% to 1.9% over 2024 levels.  Construction material costs are set to increase by 2.2% to 2.7% and construction labor will see an increase of 2.5% to 2.9% in 2025. The Canadian infrastructure, civil engineering, mining and Oil & Gas construction sectors are experiencing a pick-up as we move further into 2025.

The Mexican construction sector is forecast to grow in 2025 and 2026 due to a number of Government sponsored infrastructure projects and a pipeline of commercial and industrial projects. Mexico’s GDP will be in the 1.6% to 1.9% range going in the 2025 2^nd Q. Construction related inflation is currently 4.6% to 5.1% and construction unemployment is 7.8% to 8.8%.