René Muschter
Research Expert covering Industry & Mobility
Construction costs in the United States - statistics & facts
Construction companies need to estimate the costs they are likely to incur in a given project to deliver it under budget. To calculate those costs, contractors need to take several factors into account: the price of construction materials, fixtures, and fittings, as well as its transportation to the building site, the salaries of construction workers, the cost of design, the price of the equipment and machinery used, fees, or the price of land in that specific U.S. city, among others.
Location, building type, and the cost gap
Location can be the cause of important cost discrepancies in construction. For example, New York City’s construction costs for retail centers tend to be one of the highest in the country, due to various factors, such as limited space. The zoning, infrastructure, and even the geography of the land can also have a major effect on the construction costs. Other variables, such as the labor market or the standards and codes, can be different in each territory. Costs can also be very different depending on the type of building construction. Overall, the construction costs of non-residential buildings in the U.S. have been increasing in the past years. However, their producer prices may fluctuate, as each sector has very different needs. For instance, HVAC and commercial refrigeration equipment prices grew over three percent in 2025, a modest figure compared to the surge seen just a few years earlier.Â
Materials, labor, and equipment: where the money goes
The producer price of construction materials rose again in 2025, after building material prices fell in both 2023 and 2024. That rebound, though moderate, has renewed attention on input costs. Meanwhile, weekly earnings in U.S. construction have continued to climb, reaching nearly 1,500 U.S. dollars in 2025, reflecting persistent labor demand. On the equipment side, rental rates for construction machinery vary widely by type, with articulated wheel loaders commanding the highest weekly fees.
Could higher tariffs affect construction costs?
The United States imports a considerable part of the building materials that the construction industry needs for its activities. Although the U.S. also has a strong manufacturing capacity, with its output of veneer, plywood, and engineered wood products amounting to 26.1 billion U.S. dollars in 2024, higher tariffs on these and other products could increase construction costs. So far, the forecast growth of construction costs in major cities worldwide suggests continued, albeit uneven, price increases in 2026. Emerging segments are adding new cost pressures too: data center construction costs have risen steadily across U.S. markets, with Silicon Valley remaining the most expensive location. As material prices stabilize and labor costs continue to rise, the balance between these inputs will likely shape budget decisions for years to come.
