WASHINGTON — July 30, 2025 — Construction employment across the United States stayed robust in June, with every state reporting a construction unemployment rate below 10%, according to the latest Associated Builders and Contractors (ABC) analysis of U.S. Bureau of Labor Statistics data.

Nationally, the not seasonally adjusted construction unemployment rate edged up slightly to 3.4%, a 0.1 percentage point increase from June 2024. Even so, 18 states improved their construction unemployment rates year-over-year, 28 saw slight upticks, and four states held steady.

National construction employment remains higher than pre-pandemic levels. The June 2025 seasonally adjusted payroll construction employment stood at 8.3 million, or about 9.4% higher than its pre-COVID-19 peak of 7.6 million. NSA payroll employment for the sector was 114,000 higher than in June 2024.

“While June state construction unemployment rates continue to indicate a relatively healthy level of construction employment, uneasiness that the economy might weaken over the remainder of this year and into 2026 is producing some hesitancy among builders and developers about proceeding with new projects,” said Bernard Markstein, president and chief economist of Markstein Advisors, who conducted the analysis for ABC.

Markstein added that builders are feeling the pinch from multiple angles. “The impact of tariffs on building materials is already showing up in some prices. Meanwhile, uncertainty surrounding the level of tariffs on building materials going forward and how long they will be in place hangs over the industry. Further, the industry continues to face elevated interest rates and higher labor costs. Although most builders are loath to lay off workers at present, they are more cautious in their hiring.”

Among states, South Dakota recorded the nation’s lowest estimated NSA construction unemployment rate for June at 0.8%, setting a new record for the state. North Dakota followed at 1.2%, matching its lowest June rate ever — last seen in 2015 and 2022. New Hampshire posted its third-lowest June figure on record at 1.3%, while Montana and Oklahoma tied for fourth with rates of 1.5%, each marking their lowest June levels ever. South Dakota saw the largest year-over-year improvement, cutting its rate by 1.7 percentage points, with Montana close behind at 1.5 points lower, tied with Illinois.

At the other end of the list, Rhode Island reported the highest construction unemployment rate in June at 8.9%, but even that marks an improvement — the Ocean State saw the largest month-over-month decline among all states, dropping 1.9 points. New Jersey was next highest at 8.5%, followed by Connecticut at 5.2%, New Mexico at 4.8%, and Maryland at 4.6%. Notably, New Mexico’s figure was still its second lowest June rate on record, behind only 2022’s mark of 3.7%.

Month-to-month fluctuations show mixed results. The national NSA construction unemployment rate fell slightly by 0.1% from May to June. Twenty-nine states improved their month-to-month rates, 19 saw increases, and two — Arkansas and Kentucky — remained unchanged.

Despite the healthy snapshot, industry leaders and economists remain cautious. Higher material prices, continued tariff uncertainty, and elevated borrowing costs could temper growth in the second half of the year. While contractors have shown resilience in retaining skilled labor, some firms are scaling back on new hires until clearer signals emerge about the economic outlook for 2026.

The ABC report underscores that, so far, strong demand for skilled labor and steady project pipelines have kept construction employment levels historically tight across the U.S., even as broader economic headwinds loom.

Originally reported by Larry Adams in Woodworking Network.