As we look ahead to the second half of 2025, U.S. non-residential construction is anticipated to ease, but UBS analysts are optimistic about a significant resurgence starting in 2026. Structural tailwinds, such as investments in data infrastructure, energy, life sciences, and public-sector projects, are poised to fuel the next phase of growth. This growth comes at a time when commercial construction is facing challenges due to high interest rates and broader macroeconomic uncertainty. Goldman analysts are already predicting that machinery pricing will experience upward pressure later this year as construction activity rebounds.
UBS analysts Steven Fisher and Amit Mehrotra, among others, are forecasting that construction spending will continue to be subdued through 2025, with nominal growth expected to be just 0.8%. Real growth is projected to decline by 3% during this period. The slowdown in manufacturing project starts over the past year and ongoing challenges in commercial projects like retail, office, and warehousing are the main contributors to this weakness.
“There may be more slowing before we see a reacceleration in 2026,” Fisher noted in a recent report. He continued, “We anticipate that a combination of stimulus measures and structural factors will drive the rebound, while cyclical factors remain lackluster.”