Source: Supply Chain Dive
Date: 23rd July 2025

Rising costs and unclear trade policies are forcing contractors to rethink their procurement strategies, delay projects, and brace for prolonged uncertainty.

Volatile tariff announcements and rising material costs are clouding the outlook for the U.S. construction industry. Input prices for key materials like steel, aluminum, and copper rose 6% through May, and contractors are reporting project delays and layoffs due to procurement challenges.

The inconsistent rollout of trade duties has made it difficult for firms to budget and plan, leading to widespread caution and uncertainty across the sector.

New and increased tariffs on critical imports, such as copper and structural steel, are pushing contractors to explore alternative strategies.

From early bulk purchasing to shifting toward mass timber, firms are looking for ways to offset cost increases and reduce dependence on volatile global supply chains.

However, the lack of domestic capacity and skilled labour to replace foreign-sourced materials poses additional challenges.

While tariff policies are contributing to pricing pressure, broader macroeconomic conditions, such as workforce limitations, investor confidence, and supply chain resilience, are playing a larger role in shaping the construction landscape for the rest of 2025.

Experts warn that without trade clarity and capacity expansion, the industry may experience stagflation: a period of rising costs coupled with weakening demand.