U.S. construction employment rebounded in March, adding 26,000 jobs and signaling a short-term recovery for the industry, according to new data from the Associated Builders and Contractors.
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The gains mark a turnaround after weaker hiring earlier in the year, bringing total industry employment growth to 57,000 jobs year over year — an increase of 0.7%.
Employment growth was recorded across all major nonresidential construction categories. Nonresidential building led the increase with 4,500 new jobs, followed by nonresidential specialty trade contractors with 3,900 positions and heavy and civil engineering with 3,800 jobs added.
Despite the monthly improvement, hiring challenges remain. The industry had 202,000 job openings at the end of February, reflecting what ABC previously described as the lowest hiring rate on record.
The construction unemployment rate stood at 6.7% in March, compared with 4.3% across all industries, highlighting ongoing labor market imbalances within the sector.
Anirban Basu, chief economist at ABC, said the recent job gains show progress but warned that broader economic pressures could weigh on the industry’s outlook.
“Industrywide employment has expanded by an average of 19,300 jobs per month in 2026. That’s a marked improvement from 2025, when construction employment actually declined, but there remains cause for concern about the industry’s outlook,” Basu said.
He added that geopolitical and economic factors could further complicate hiring conditions.
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“The March jobs data do not capture the detrimental ways in which the conflict in Iran will continue to affect the construction industry. Oil prices have risen to heights not seen since 2022 and diesel prices have soared to $5.40 per gallon, up more than $1.90 per gallon from the start of 2026. At the same time, higher treasury yields have put renewed pressure on borrowing costs. While contractors were relatively optimistic about the near-term outlook as of February, according to ABC’s Construction Confidence Index, it remains to be seen how long that optimism can persist under current economic conditions.”
Rising fuel costs, increased borrowing expenses and global uncertainty are expected to remain key variables influencing construction activity in the coming months.
While March’s job growth offers a positive signal, industry leaders continue to monitor economic headwinds that could impact workforce expansion and project pipelines throughout 2026.
Originally reported by Neil Gerrard, Senior Editor, Construction Briefing in Construction Briefing.
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