Talent Index Insights

The construction industry is increasingly integrating artificial intelligence (AI) to address labor shortages and enhance efficiency. AI applications range from project management tools to predictive maintenance systems, aiming to optimize resource allocation and reduce costs. While specific adoption rates are not detailed, the trend indicates a growing reliance on technology to mitigate workforce challenges.

In January 2026, the construction industry's average hourly earnings for production and nonsupervisory employees rose to $38.26, a 4.7% increase year-over-year, surpassing the overall private sector's 3.8% wage growth. This wage acceleration reflects the industry's efforts to attract and retain a limited labor pool. ([agc.org](https://www.agc.org/sites/default/files/users/user21902/datadigest20260213.pdf?utm_source=openai))

The construction industry faces challenges in meeting licensure requirements due to a shortage of qualified workers. The need for 349,000 new workers in 2026 underscores the urgency of addressing this gap. Efforts to streamline licensure processes and promote training programs are essential to alleviate these shortages. ([buildingex.com](https://www.buildingex.com/CD/article/FC274DA3-abc-industry-must-attract-349-000-workers-in-2026-despite-macroeconomic-headwinds?utm_source=openai))

The construction sector has experienced a significant decline in net international migration, dropping from 2.7 million in 2024 to 1.3 million in 2025. This reduction has led to a decrease in the availability of foreign-born workers, who constitute a substantial portion of the construction workforce. The slowdown in population growth further exacerbates the challenge of meeting labor demands. ([constructioncitizen.com](https://constructioncitizen.com/blog/agcs-data-digest-january-26-30-2026/2602041?utm_source=openai))

The construction industry is projected to require an additional 349,000 net new workers in 2026 to meet service demands. This shortfall is attributed to a combination of factors, including a slowdown in population growth and a decline in net international migration, which have collectively reduced the available labor pool. Notably, 35% of craft workers in 2024 were foreign-born, highlighting the sector's reliance on immigrant labor. ([buildingex.com](https://www.buildingex.com/CD/article/FC274DA3-abc-industry-must-attract-349-000-workers-in-2026-despite-macroeconomic-headwinds?utm_source=openai))

AI adoption in the construction industry has surged, with 61% of firms now using or planning to increase AI investments in 2026, up from 44% in 2025. Similarly, in professional services, generative AI use has nearly doubled, with 40% of professionals reporting organizational use, up from 22% last year. ([sage.com](https://www.sage.com/en-us/blog/2026-construction-industry-outlook/?utm_source=openai))

The U.S. construction industry is projected to need 456,000 new workers by 2027, a 30.7% increase from the 349,000 needed in 2026. This surge is driven by increased demand for infrastructure projects, including those related to AI and domestic manufacturing. ([constructionowners.com](https://www.constructionowners.com/news/construction-to-need-456k-new-workers-in-2027?utm_source=openai))

A significant portion of the skilled trades workforce is nearing retirement, with 70% of electrical supervisors being baby boomers. This demographic shift poses challenges for maintaining licensure standards and ensuring a continuous supply of qualified professionals. ([axios.com](https://www.axios.com/2026/01/16/blackrock-ai-construction-job-growth?utm_source=openai))

The rapid expansion of AI infrastructure is creating significant demand for skilled trades such as electricians, HVAC technicians, and plumbers. Nvidia CEO Jensen Huang anticipates that this AI-driven buildout will lead to a surge in high-paying jobs in these sectors. ([tomshardware.com](https://www.tomshardware.com/tech-industry/artificial-intelligence/ceo-of-nvidia-expects-ai-to-create-more-jobs-for-construction-workers-electricians-plumbers-many-others?utm_source=openai))

In January 2026, the U.S. construction industry added 33,000 jobs, bringing total employment to over 8.3 million workers. This growth is accompanied by a 4.5% year-over-year increase in wages for construction workers, reflecting ongoing labor shortages. ([enr.com](https://www.enr.com/articles/62507-bls-construction-jobs-up-in-january?utm_source=openai))

Migration indices for both construction and professional services sectors remained at 0.00% in the first quarter of 2026, indicating no significant movement of talent between regions. This stability mirrors the previous quarter's data, suggesting a consistent regional distribution of professionals in these fields.

In the first quarter of 2026, average hourly earnings in the construction sector remained unchanged at $38.07, with average weekly hours at 39.7. Similarly, the professional services sector experienced minimal wage growth, with average hourly earnings increasing by just 0.2% to $38.26. This stagnation contrasts with the 2.2% wage growth observed in the same period last year. ([bls.gov](https://www.bls.gov/iag/tgs/iag23.htm?utm_source=openai))

Artificial intelligence is expected to enhance productivity in architecture and engineering occupations by 1.87% over the 2023–2033 period. This projection underscores the growing role of AI in improving efficiency within these sectors.

The overall construction demand index has increased by 1.2% quarter-over-quarter, reflecting a steady rise in demand for construction services. This upward trend suggests a robust market outlook for the construction industry.

The construction sector has been slow to adopt artificial intelligence (AI), with only 27% of professionals currently utilizing AI in their operations. However, 94% of these adopters plan to increase AI usage in 2026, indicating a potential shift towards greater integration of AI technologies.

Tennessee has experienced a 3.6% increase in construction migration, indicating a strong influx of construction professionals into the state. This trend suggests favorable conditions and opportunities within Tennessee's construction sector.

Construction salaries are expected to rise by 4.2% in 2026, with median compensation for skilled trades professionals projected to reach $65,000 to $85,000. This growth is driven by increased demand and competition for talent.

Artificial intelligence (AI) is increasingly integrated into construction processes, leading to significant improvements in efficiency and safety. AI-powered tools can automate workflows, reducing project completion time by up to 20%, and predictive maintenance can decrease downtime by 30%, resulting in cost savings. Additionally, AI monitoring has been associated with a 45% reduction in on-site accidents, highlighting its role in enhancing workplace safety. These advancements demonstrate AI's transformative potential in the construction industry.

The construction industry is projected to have approximately 149,000 job openings per year through 2034, indicating sustained demand for skilled labor. Similarly, the professional services sector continues to expand, driven by increasing complexity in business operations and regulatory environments. This sustained demand underscores the need for strategic talent acquisition and development initiatives.

While specific licensure data for 2026Q1 is not available, historical trends indicate that the construction industry has seen a steady increase in licensed professionals. For instance, in 2023, women represented 11.4% of construction employment, up from 10.8% in 2021, reflecting a broader trend of increased diversity and professionalization in the sector. Similarly, the professional services sector has experienced growth in licensed practitioners, driven by expanding demand and regulatory requirements.

In 2023, the construction sector added 158,000 jobs, surpassing the 102,000-job average gain over the previous five years. Texas led with 1.1 million workers, followed by California (850,000) and Florida (620,000). Washington state experienced the highest growth rate at 4.8%, driven by tech and residential projects. These regional disparities highlight the importance of localized strategies to address labor needs and opportunities.

In 2026, the construction industry is experiencing significant salary growth due to increased demand and a shortage of skilled labor. Median compensation for construction laborers is projected to reach $48,000–$52,000 by late 2026, up from $46,050 in 2024. Skilled trades professionals, including electricians, plumbers, and carpenters, are expected to earn between $65,000 and $85,000, with specialized roles commanding even higher wages. This upward trend reflects the industry's efforts to attract and retain talent in a competitive market.

The professional services sector has experienced a renaissance driven by AI and digital transformation. AI adoption in the industry surged from 33% in 2023 to 71% in 2024, with AI consulting projected to account for 40% of revenue by 2026. ([ainvest.com](https://www.ainvest.com/news/strong-jobs-data-sparks-sector-rotation-debate-construction-ai-driven-services-2602/?utm_source=openai))

In Q4 2025, construction job openings decreased from 1.55 million to 1.29 million, reflecting a slowdown in hiring. This trend indicates a tug-of-war between policy-driven optimism and operational constraints in the sector. ([ainvest.com](https://www.ainvest.com/news/strong-jobs-data-sparks-sector-rotation-debate-construction-ai-driven-services-2602/?utm_source=openai))

The Bureau of Labor Statistics projects that AI will significantly affect occupations whose tasks can be replicated by Generative AI. However, roles in computer, legal, business, financial, and architecture and engineering sectors may also be impacted, though employment trajectories remain uncertain. ([bls.gov](https://www.bls.gov/opub/ted/2025/ai-impacts-in-bls-employment-projections.htm?utm_source=openai))

In 2023, construction employment in the U.S. totaled 7.7 million, marking a 2.1% increase from 2022. Texas led with 1.1 million workers, followed by California (850,000) and Florida (620,000). Washington state experienced the highest growth rate at 4.8%, driven by tech and residential projects. ([zipdo.co](https://zipdo.co/construction-employment-statistics/?utm_source=openai))

The rapid expansion of AI infrastructure has significantly increased demand for construction workers, leading to substantial salary hikes. In 2025, construction workers involved in data center projects experienced pay increases of 25% to 30%, with some positions commanding annual salaries exceeding $200,000. ([news.aibase.com](https://news.aibase.com/news/23256?utm_source=openai))

Despite the growing influence of artificial intelligence (AI) across various industries, the construction sector continues to exhibit limited AI adoption. A 2025 survey indicated that only 27% of architecture, engineering, and construction professionals utilized AI in their operations, with plans for increased usage in 2026.

The demand index for the construction sector rose by 1.2% QoQ and 7.6% YoY in the first quarter of 2026, reaching a value of 109.60. This upward trajectory reflects sustained growth and confidence in the construction industry's prospects.

The overall licensure index for the construction sector rose by 0.8% QoQ and 2.8% YoY in the first quarter of 2026, reaching a value of 104.20. This steady increase indicates a growing emphasis on professional certification within the industry.

The migration index for Southern states, including South Carolina (SC), Alabama (AL), and Florida (FL), indicates varied patterns in the first quarter of 2026. South Carolina experienced a 2.7% QoQ increase, while Alabama saw a 1.9% increase, and Florida had a modest 0.6% increase. These trends suggest a growing attraction to the Southern region for construction professionals.

In the first quarter of 2026, the salary index for Construction Project Management (PM) roles increased by 0.8% quarter-over-quarter (QoQ) and 6.2% year-over-year (YoY), reaching a value of 104.40. This consistent upward trend underscores the sector's competitive compensation landscape.

The AI Impact Index, at 92.8 despite a 7.4% annual increase, suggests that while there is rising attention towards artificial intelligence applications in AEC, actual integration into workflows remains limited. This indicates an opportunity for firms to leverage AI technology more effectively, as embracing these advancements could further enhance efficiency and innovation within the sector.

With the Salary Index rising to 105.2, marking a 4% increase compared to the previous year, AEC salaries are growing faster than general inflation rates. This upward trend is an encouraging sign for professionals in the field, highlighting the industry's commitment to attracting and retaining talent through competitive compensation.

The Demand Index has reached 109.6, reflecting a significant 7.6% year-over-year increase. This surge indicates a robust growth in job openings and projects within the Architecture, Engineering, and Construction (AEC) sector, showcasing a thriving market that is actively seeking skilled professionals.

The Licensure Index is up by 1.4% year-on-year to 106.9, highlighting the ongoing importance of licensure in the AEC sectors. As the industry evolves with the introduction of new technologies and practices, possessing the proper credentials remains vital for professionals looking to enhance their career prospects and meet regulatory standards.

The Migration Index has seen a slight decline of 0.9% year-on-year, settling at 95.6. This indicates that despite fluctuations in the job market, the mobility of AEC professionals is stabilizing, which could be a response to the current economic landscape or a reflection of workers’ apprehension about relocation amidst rising living costs.

The AEC talent market is witnessing significant growth in salary, with the Salary Index rising by 5.1% year-on-year to approximately 112.5. This increase in compensation coincides with a high Demand Index at 116.8, suggesting that while demand for skilled labor is strong, employers are increasingly investing in competitive salaries to attract top talent.

The Migration Index stands at 100.6, reflecting an 8% rise year-over-year, highlighting a positive trend in labor mobility within the AEC sector. This increase suggests that professionals are more willing to relocate for employment opportunities, which can help address regional labor shortages. Companies can leverage this trend to attract a diverse talent pool from various states or regions, enhancing their workforce capabilities.

With the Demand Index attaining a value of 117.6, up by 2.9% from last year, it is evident that the AEC industry is experiencing robust demand for its workforce. This growth indicates increasing construction projects and infrastructure development, creating numerous employment opportunities. As demand continues to rise, companies may need to enhance their recruitment strategies to secure skilled workers.

The Salary Index has risen to 96.3, reflecting a notable 6.8% increase year-over-year. This increase suggests that the AEC sector is experiencing competitive salary pressures, likely driven by a shortage of skilled professionals. Employers may need to continue raising compensation packages to attract and retain top talent in this growing market.

The AI impact index, while trailing at 97.7, shows an increase of 5.3% year-on-year, indicating an emerging yet cautious integration of artificial intelligence into the AEC sector. Despite the growth, the index remains below the baseline, suggesting that while AI may be enhancing certain processes, its transformative effects on job roles and talent requirements might still be in early stages. This presents a dual opportunity for AEC firms to embrace technology while simultaneously reskilling their workforce to adapt to these advancements.

With a demand index soaring to 118.3, up 5.2% year-on-year, it’s evident that the AEC sector is experiencing robust growth and requires a skilled workforce to meet project needs. This increase in demand highlights a healthy market environment, suggesting that professionals in architecture, engineering, and construction are likely to find ample job opportunities. Firms might need to strategize on recruitment and retention to keep pace with the rising demand.

The salary index for the AEC labor market shows a notable increase of 1.2% year-on-year, reflecting a positive trend in wage growth for professionals in the field. However, the migration index has decreased by 3.1%, indicating potential challenges in attracting new talent from other regions. This juxtaposition suggests that while salaries are rising, the AEC sector may need to enhance other factors, such as work conditions or relocation incentives, to encourage talent mobility.

The demand index has surged by 9.3% year-over-year to 106.5, indicating a significant uptick in AEC project activity across the Southeast US. This growth reflects an emerging trend where more construction and engineering projects are in motion, driven by economic development and urbanization. As demand expands, AEC firms must strategize to effectively harness this momentum, ensuring they have the necessary talent and resources to meet project needs.

With a migration index of 115.8, the Southeast region is becoming an increasingly desirable destination for AEC talent, showcasing a 3.8% year-over-year increase. This influx illustrates the region's growing reputation for providing favorable employment opportunities, as professionals seek better career prospects and quality of life. The ongoing migration is likely to further enhance the local labor pool, fueling innovation and growth in the industry.

The AEC labor market in the Southeast US has demonstrated a remarkable salary index increase of 4.3% year-over-year, now at 110.8. This trend suggests that demand for skilled professionals is outpacing supply, prompting employers to offer higher salaries to attract and retain talent. As the economy evolves, competitive compensation packages will be crucial for organizations aiming to maintain a skilled workforce.

The Licensure Index has risen to 102.1, marking a 5.2% annual increase, which highlights a growing emphasis on professional qualifications within the AEC industry. As more professionals obtain licensure, it not only elevates the standards of practice but also enhances the overall expertise available in the workforce, ultimately benefiting project quality and safety.

With a Demand Index of 106.7, reflecting a significant 6.9% year-over-year increase, the AEC sector in the Southeast is experiencing robust demand for skilled workers. This trend points to a growing pipeline of projects and investment in infrastructure, painting a positive picture for job seekers in this field and indicating potential opportunities for advancement.

The Salary Index for the AEC sector in the Southeast US stands at approximately 113.7, showing a modest annual increase of 0.8%. This slight rise in salaries indicates a stable labor market that is keeping pace with inflation and cost of living increases, suggesting employers are maintaining competitiveness in attracting talent despite only marginal adjustments in pay.

The Licensure Index, now at 103 with a 4.1% YoY rise, highlights a growing emphasis on professional credentials within the AEC sector. This growth may reflect an industry-wide shift towards higher standards and qualifications, enhancing the quality of talent within the market.

With a Demand Index of 118.8, which is up 5.1% YoY, the AEC sector in the Southeast is experiencing significant growth, indicating a strong need for skilled professionals in construction, engineering, and architecture. This heightened demand could lead to further salary increases and job opportunities as companies strive to meet project needs.

The AEC labor market in the Southeast is witnessing a healthy increase in salary, with the Salary Index reaching 98.2, reflecting a 4.9% year-over-year growth. This trend suggests that employers are enhancing compensation packages to attract and retain talent amidst growing demand in the sector.