Construction Industry Trends (June 2024)

Our monthly construction industry trend report combines the latest industry data with our internal findings from National Business Capital’s award-winning team. With extensive experience in the construction industry since 2007, we are thrilled to share these findings and expand on them through our unique expertise.

Our goal is to provide business leaders and decision-makers with the necessary information and data to make well-informed decisions in their business endeavors.

Industry Revenue (2010 – 2024)

Here, we look at industry revenue trends on a high level. The chart encompasses the entirety of the construction industry’s reported revenue into one centralized report, allowing for an in-depth overview.

June 2024 – We’re four years since the onset of the pandemic, yet businesses haven’t fully recovered to their pre-pandemic levels. The graph above shows a significant rise in revenue up until early 2020, when revenue peaks and begins to fall. Since then, it’s stayed in a lull as the world has rebounded.

However, if you look closely, you’ll see that an upward trend is returning. Although we haven’t yet broken the pre-pandemic high, the bounce-back to “normal” in terms of revenue has seemingly begun.

Construction Employment Change By State

Viewing construction employment trends on a state-by-state basis allows for a deeper understanding of U.S. construction employment trends.

June 2024 – Seeing states with positive 10%+ employment changes – and zero with 10%+ negative changes – suggests a growing industry.

Alaska and South Dakota, both big mining industry states, stand out as the two strongest states in terms of employment gain. According to Alaska’s state government, “Infrastructure money and more oil and gas activity will be economic bright spots this year,” which suggests construction activity in both industries. For South Dakota, residential and municipal construction is expected to grow as the state continues to attract tourists and new residents with lower-than-average taxes, along with a rebounding mining industry.

The mining industry’s faced challenges over the last few years, but sentiment suggests that the industry might be through the woods. We’ll need to wait and see for ourselves, but Statista expects a 2.72% growth rate from 2024-2028.

Cumulative Change in Producer Price Index (PPI) For Inputs and Bid Prices for Nonresidential Construction

Bid prices generally follow the trends of input costs, although they may lag behind the trend.

June 2024 – Last month, we touched on the rising cost of materials, with the exception of steel, which saw a significant drop in value throughout the first half of 2024. The high-price trend continues into this month.

Recent inflation data provided confidence to the FOMC, but it’s still not enough to make any changes in the short term. They reduced the number of projected 2024 rate cuts from three to one while suggesting the long-term rate might be higher for longer than expected. They do plan for up to five rate cuts in 2025, but if the data doesn’t support the move, these may also come off the table.

Construction Spending (2017 – 2024)

Construction spending trends, broken down by channel, offer a unique point of view into the industry’s performance at scale.

June 2024 – Zooming in on the always-upward trend showcases the impact of major events on the industry. The first dip in 2020, caused by the onset of the pandemic, was followed by an upward trend as the world fought to return to normalcy. In 2022, lingering supply chain challenges hit another peak, causing spending to decline as companies nationwide were stuck in limbo, fighting for materials.

Major projects are underway in the manufacturing industry, too, which are made possible by the construction community. Arizona has two semiconductor plants under construction, one valued at $40MM and the other at $20MM. Texas, New York, and Idaho are also sites of new high-value semiconductor facilities. Construction activity in the manufacturing sector alone is up 70% since 2019, compared with 30% growth in total construction.

We’re in an election year that may or may not impact construction spending in the next term. It’s important for anyone in the community to stay aware of changes in government policies so they can seize growth opportunities without delay.

National Business Capital’s Construction Recap (June 2024)

Each month, we’ll offer our unique viewpoint on the construction industry’s short to mid-term outlook. Our insights come from a combination of available industry statistics, internal data, and the general sentiment of the construction clients we work with daily.

• Approval Dollars Are 71.92% Higher Than June 2023 – As lenders continue to look more favorably upon the industry, construction clients are receiving approvals 71.92% higher than they were at the same time last year. Better market conditions and higher quality financials from construction clients are behind the trend.
• Equipment and Expansion Continue to Be the Most Common Use of Funds – Month over month, construction clients continue to choose “expansion” and “equipment” as their capital needs. This trend has stayed consistent throughout 2024, and we don’t expect a change in the near-future as the industry continues to grow.
• Texas, California, Florida, and Illinois Rank Among NBC’s Top Funding States – National Business Capital’s transaction volume was highest in the aforementioned states for June 2024. All of these states posted positive construction employment growth this month, and our data suggests that companies aren’t just hiring – they’re growing, scaling, and taking on more work.