Where U.S. Construction Spending Is Expected to Grow

U.S. construction spending is projected to rise to $2.85 trillion by 2031, according to the National Construction Spending Trends Report from Merlo America and BiltData.ai.

The report forecasts spending will increase from $2.22 trillion in 2026 to $2.85 trillion in 2031, an increase of more than $600 billion. It examines construction markets across the country as well as data center development and agricultural economic activity.

Five states — California, Texas, Florida, New York, and New Jersey — are projected to account for approximately 42% of total U.S. construction spending by 2031.

The New York-Newark-Jersey City metropolitan area is projected to be the country's largest construction market, with $230 billion in spending by 2031. Los Angeles, Chicago, Dallas-Fort Worth, and Houston are also projected to rank among the five largest markets.

Collectively, the top 10 metropolitan areas are expected to represent more than one-third of U.S. construction spending.

The report points to artificial intelligence, cloud computing, and digital infrastructure as factors contributing to construction demand. The top 12 metropolitan markets are projected to account for nearly 73% of U.S. data center capacity by 2031.

Dallas-Fort Worth, Washington, D.C., Chicago, and Phoenix are expected to remain among the most active technology-driven construction markets.

"AI is accelerating investment in data centers and infrastructure, but the bigger opportunity is understanding where that work is happening. Our goal is to help contractors, dealers, and rental companies move beyond the headlines by turning market data into practical insight they can use to make smarter decisions about where to invest and grow,” shares Nick Mavrick, CEO of BiltData.ai.

Cole Renken, general manager of Merlo America, said the report is intended to identify where construction demand is expected to develop.

"Every business in our industry is making decisions today that will shape the next five years," said Renken. "Whether you're investing in equipment, expanding a branch, or growing a service team, understanding where demand is heading gives you a real advantage. That's exactly what this report is designed to help with."

Residential construction is projected to account for $1.026 trillion in spending by 2031. Commercial construction is forecast at $741 billion, industrial construction at $684 billion, and infrastructure investment at $399 billion.

Industrial construction includes manufacturing and data center development.

The report also found continued activity in rural markets. An analysis of 179 Bureau of Economic Analysis economic areas found that the top 40 agricultural markets account for more than 70% of agricultural employment.

"The value of this report lies in helping businesses move from reacting to planning," adds Renken. "Understanding where demand is expected to grow gives decision makers the confidence to invest in the right markets and position equipment more effectively, ultimately supporting them to effectively plan for sustainable growth."

The report combines construction spending forecasts, metropolitan economic trends, projected employment growth, data center capacity estimates, and agricultural economic indicators.

"Construction spending isn't increasing evenly across the country, and that's what makes this report so valuable," concluded Mavrick. "Merlo America shares our belief that businesses make better decisions when they have better market intelligence. Together, we've developed a report that helps contractors, dealers, and rental companies identify where opportunity is emerging and plan for it with greater confidence."