The construction labor shortage isn’t a forecast anymore, it’s a payroll problem. The industry needs about 349,000 net new workers in 2026 just to keep pace with demand, and that figure climbs toward 456,000 in 2027 as spending picks up. The gap is wide, and three forces are pulling it wider at once.
What’s driving the construction labor shortage
Start with who’s already on site. Immigrants make up 34% of the construction workforce nationwide, and the share runs past 60% in drywall, roofing, and plastering. Net immigration fell hard from 2024 into 2025, with another drop projected for 2026, so the pipeline that used to backfill those trades is running dry.
Enforcement is the second force, and it shows up fast. A joint survey from the Associated General Contractors of America and NCCER found 28% of firms hit workforce disruptions tied to ICE activity in the prior six months. Around 10% said they lost workers directly to enforcement or to rumors of raids; another 20% said their subs did. A crew doesn’t have to be detained to shrink. Word of a raid two counties over is enough to keep people home.
The third force is the one everybody wants: demand. The data center boom that’s tightening the labor market needs electricians, pipefitters, and concrete crews in the same regions where labor is already short.
What contractors are doing about the worker gap
Some are paying up, which lifts bid prices and eventually shows up in what buildings cost. Some are leaning on the recruiting playbook, like the dating-app approach to trades hiring now running on New Jersey campuses. Others are betting on automation for the scopes that allow it.
None of those fixes the math this year. Training a journeyman takes seasons, not weeks, and the workforce is aging out faster than schools are filling it. The honest read: cost and schedule pressure from labor is baked into 2026, and the firms that protect their crews now will be the ones still bidding competitively in 2027.
This is a sensitive topic for many workers and families. If you or someone on your crew is affected, local AGC chapters and workforce boards can point to support and legal resources.