Texas’ building boom shows no sign of slowing, even as the industry grapples with workforce shortages, rising costs and mounting infrastructure pressures. With population growth driving demand for homes, offices and industrial development, the Lone Star State remains one of the strongest construction markets in the country — but continued momentum may depend on how quickly companies and policymakers respond to emerging challenges.
According to Statista projections released earlier this year, construction spending in Texas is expected to reach $50.3 billion by the end of 2025, outpacing every other state in the U.S. The numbers reflect a multi-year wave of migration into Texas, which has fueled demand for single-family housing, multifamily construction, industrial plants, data centers, and commercial redevelopment across major metros.
While cities such as Dallas, Houston and Austin continue to grow upward, much of today’s most transformative development is reshaping previously rural suburbs. New growth corridors in North Texas — including Anna, Celina and Melissa — are expanding rapidly as developers push outward to meet housing and logistics demands. This shift has attracted suppliers like Astrak US, which entered the Texas market in 2023 to serve growing construction needs involving heavy equipment wear parts and undercarriage components.
However, growth comes with friction. Even with more cranes on the skyline, the workforce behind Texas construction is feeling stretched thin. Astrak US commercial director Calum Mair told CandysDirt.com that a shrinking pipeline of trained workers is slowing the pace of development.
“Younger workers are also entering the trades more slowly than the rate of retirements, leading to a persistent gap in skilled labor availability,” he said. “Labor shortages could create project delays or cost overruns if they’re not addressed through automation and training.”
Industry watchdogs say Texas employment figures are rising — but still not fast enough. The Associated General Contractors of America reports that construction jobs in Texas grew 3.2% year-over-year in July and are up 12% since February 2020, but that growth hasn’t fully closed the workforce gap left by retirements, wage pressures, and shifting immigration policies. An estimated 10%–19% of the construction workforce may be affected by recent federal deportation actions, though analysts caution it is too early to quantify the full impact.
To stay competitive, employers are increasing pay, strengthening safety practices and offering long-term career development, according to Mair. Those moves reflect a broader strategy to retain skilled workers and attract new talent into the trades, an effort that may prove crucial over the next decade.
Labor isn’t the only pressure point. Construction firms are also dealing with higher land and material costs, partially driven by inflation, global trade uncertainty, and rapid land consumption in high-growth corridors. This is reshaping how Texas developers plan and finance new projects. As Mair explains:
“Rising material and land costs are making some large-scale developments less financially viable, pushing developers toward denser, more sustainable projects.”
Population growth is also increasing demand for public infrastructure — not just private development. Expanding neighborhoods and industrial campuses require new roads, water lines, power delivery, and wastewater upgrades, putting strain on state and local budgets. According to Mair, this means Texas must keep investing to avoid supply bottlenecks that could stall growth.
“He added that population stresses are also requiring continuous public investment in existing utilities and transportation infrastructure to sustain the growth.”
Despite these challenges, Mair says investor confidence remains strong and demand for construction services is not slowing down.
“Despite these factors, the overall outlook remains positive,” Mair said. “The state’s diversification into manufacturing, data centers, and clean energy construction continues to create strong, long-term demand.”
From semiconductor fabrication to EV battery plants and renewable energy projects, Texas is positioning itself as a hub for the industries driving America’s industrial future. If workforce development, infrastructure expansion and land-use planning can keep pace, Texas may not just lead the nation in construction spending — it may redefine it.
Originally reported by Charles Grand in Candys Dirt.
