Construction workers in Kentucky are earning less than their peers nationwide when local costs are factored in, according to a new report from Construction Coverage, which analyzed Bureau of Labor Statistics wage data and cost-of-living figures from the Bureau of Economic Analysis.

In Kentucky, the cost-adjusted annual wage for construction workers stands at around $56,000—below the national median of $58,360. While construction employment has generally stabilized across the U.S. following the pandemic-driven surge in infrastructure and housing projects, persistent challenges are eroding worker gains. These include inflation, high interest rates, restrictive immigration policies, and new trade tariffs that are raising material costs and slowing project timelines.

“The construction industry is navigating a period of heightened uncertainty in 2025,” the report noted, “marked by shifting trade policies, restrictive immigration enforcement, and persistently high interest rates.” These factors, it added, have "driven up the cost of materials, delayed projects and prompted redesigns," while also exacerbating skilled labor shortages.

Despite these pressures, the construction sector continues to offer relatively strong compensation. Nationally, construction workers earn a median wage about 18% higher than the $49,500 median for all U.S. occupations. Over the past two years, construction wages have risen by 15.4%—from $50,570 to $58,360—outpacing the 6.9% growth across all fields.

However, the value of that pay depends heavily on where workers live. Midwestern states such as Illinois offer the best cost-adjusted earnings, with workers taking home the equivalent of over $79,000 annually after factoring in living expenses. In contrast, many Southern states, including Kentucky, consistently rank lower on the adjusted wage scale.

At the metro level, high-cost cities like San Jose and Boston still offer competitive adjusted wages due to higher nominal pay. But in places like Kentucky, where inflationary trends and cost pressures have steadily chipped away at household budgets, even modest wage growth may not be enough to support long-term financial security for construction professionals.

“Construction employment has stabilized in early 2025 after a strong post-pandemic recovery, reflecting broader economic uncertainty,” the report observed. While job numbers have plateaued around 8.3 million workers, wages remain relatively strong—particularly in markets that offer a better balance between income and living costs.

The analysis reinforces a key truth for today’s workforce: where you live can matter just as much as what you earn, especially in a volatile economy.

Originally reported by Construction Coverage in Hazard Herald.