U.S. Construction Growth Diverged Across Sectors in 2026
Infrastructure projects drove activity while hospitality and office sectors remained weak throughout the year.
Updated on Sept. 29, 2026 in Construction
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Construction growth in the United States showed distinct variation across project types during 2026, with infrastructure and manufacturing leading gains. Conversely, sectors including hospitality, office space, and single-family residential construction remained largely subdued.
Why it matters
Limited supplies of materials and a persistent shortage of skilled labor have extended construction schedules across the country. Additionally, rising defense costs linked to litigation and social inflation are driving up casualty losses for contractors.
General liability insurance market price movement showed low- to mid-single-digit changes during 2026. While property insurance markets saw softening, casualty losses continue to rise due to litigation funding.
The details
Contractors are actively seeking alternative component sources to combat project delays while brokers manage longer coverage timelines. Property insurance markets softened over the year, even as claims severity remains a notable concern for firms.
Timeline
Property insurance markets softened throughout 2026.
Artificial intelligence adoption is expected to become a key project management variable by 2027.
Market Landscape
Construction growth remains bifurcated, mirroring a broader industry shift toward infrastructure as commercial sectors struggle. The sector's reliance on technology in 2027 reflects a structural attempt to overcome long-standing constraints in labor availability.
Consumers and businesses looking to build or renovate may face extended project timelines due to ongoing material and labor constraints. These challenges, combined with shifting insurance costs, could continue to affect final project pricing and delivery schedules.
The takeaway
Firms should prioritize technological integration and diverse supply chains to mitigate the impact of labor shortages and rising insurance costs. Monitoring insurance market shifts remains critical for contractors navigating the current volatility in casualty losses.
Further reading
For more background on industry challenges, visit the Construction section.
Source note: This article includes information reported by Insurance Business.
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