Construction Industry Trends That Will Affect Your Business

20 July 2021All, Construction, Digital Transformationconstruction industry, Trends



There is a light at the end of the tunnel, and no, it’s not a train. Things are looking up for several sectors of the construction industry. However, economic recovery is being complicated by supply chain problems nationwide. According to the 2021 Dodge Data and Analytics (DD&A) report “A Mid-Year Outlook for the Construction Industry,” the price of construction materials in April, 2021, was 24% higher than in April, 2020. This is one trend that will affect the way you do business in the coming months and years. Following is a list of others.


  • Big demand for warehouses – This is a bright spot in total construction starts in 2021. Record-setting construction of distribution centers is being fueled by big retailers. Amazon’s 3.8-million square-foot distribution center in the State of New York is the second largest warehouse in the world. Construction of warehouses for Walmart, Nike, John Deere, Target, and Walmart is expected to be followed by many others.
  • Renovations – Office remodeling is increasing to make better use of existing space and add amenities to attract and keep talent. Businesses are also striving for better comfort and air handling.
  • More data centers – Construction of data centers is in demand as cloud computing becomes more and more popular.
  • Online shopping – This shift is likely the driving factor behind historic low levels of retail construction.
  • Increasing need for healthcare facilities – Strong growth is expected in construction of clinics, nursing homes and hospitals.
  • Struggling hospitality sector – Recovery of the hotel construction sector is expected to be delayed because of financial impacts caused by reaction to the pandemic.
  • Uncertainty about office buildings – Work-from-home opened a pandora’s box of possibilities for what the “offices” of the future might look like. As companies decide how much office space they really need, that uncertainty carries over to lukewarm demand.


  • More infrastructure – According to DD&A, the long-term outlook is positive for construction of streets, highways, bridges, hazardous waste facilities, and electric power generation.
  • Water and sewer projects – There is widespread support for funding construction of large drinking water and sewer projects.
  • Environmental public works – There is increasing public support and activity around utility-scale renewable energy projects.


  • Continued demand for multifamily housing – Construction of duplexes, townhomes and apartments in the suburbs is still performing well.
  • Higher lumber prices – The single-family housing sector is vulnerable to volatile materials prices. In addition to lumber, there have been price increases in hardware, paint, copper, iron, steel, cut stone, gypsum, and others.
  • Shortage of skilled labor – Less training in the construction trades, combined with fewer people eager to work, has strained the workforce. The same situation plagues the manufacturing industry.
  • Less affordable homes – In many markets, there are too few single-family homes to satisfy the demand, which is pushing prices higher.

The way you position your company to take advantage of the emerging positive trends – or cope with the complications – will affect your resilience in the coming months and years. There are opportunities for growth in residential, commercial, manufacturing, and institutional construction sectors. By tracking the trends and planning ahead, you can stay competitive in the industry.

Learn about the onslaught of change and digital transformation causing construction markets to shift … download the free new eBook from Applied Software: “Ultimate Construction Tech Stack for 2021.” 



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