Cost trends
Construction faces new headwinds
Structural iron prices
Steel prices
Aluminum prices
+7%
+7%
+2%
The U.S. construction industry is under pressure from new trade and immigration policies.
A 50% tariff on steel and aluminum began on June 4, 2025. Earlier, on April 2, a broader tariff of over 10% was announced for goods from most countries. These included reciprocal tariffs. One week later, the government paused these for 90 days. The general tariff was then reduced to 10%, except for China, which now faces a 30% rate. This is down from the original proposal of 145%. Key materials such as steel, aluminum, copper, and lumber are excluded from these hikes.
Still, material costs are rising. As of April, fabricated structural iron and steel prices are up 7% this year. Aluminum is up 2%. These increases, along with policy uncertainty, may cause delays or cancellations of new projects. Ongoing work is expected to continue, but new developments are more at risk due to rising costs and longer delivery times.
Unlike earlier tariffs, which focused on specific materials, current measures affect both raw and finished goods. This is increasing supply chain strain. Contractors are already adapting by sourcing locally, ordering early, or using substitute materials. But these changes are adding more pressure to both supply and pricing.
Labor is also a growing concern. Around 30% of construction workers are immigrants, and a quarter of them may be undocumented. Tighter immigration rules could reduce the labor pool and drive up costs. This makes pricing and planning even more difficult.
In short, rising tariffs, supply constraints, and labor shortages are pushing up project costs and causing delays across the industry.