Every economic report this year says the same thing: strip out data centers and nonresidential construction is falling. True, but incomplete. There’s a second engine, and it’s factories. A reshoring wave in semiconductors, autos, rail, and grid equipment is keeping industrial builders busy while offices, retail, and warehouses drift.
The build list
The commitments are concrete. Toyota confirmed a $3.6 billion expansion in San Antonio to bring Tacoma production onto U.S. soil. Bosch put up to $2 billion into its Roseville, California site to make silicon carbide semiconductors, the chips that run EV powertrains and fast chargers. Stadler broke ground on a 245,000-square-foot rail plant expansion in Salt Lake City. A major manufacturer started what will be the nation’s largest facility for large power transformers, the grid hardware the whole electrification push depends on. None of these are data centers, and all of them need contractors.
What ties them together is policy plus fear. Federal incentives for chips and clean energy lowered the cost of building domestically, and supply-chain shocks taught manufacturers that a plant an ocean away is a liability. The result is a class of megaprojects, chip fabs, battery plants, EV lines, that behave differently from commercial work. They’re bigger, longer, more mechanically dense, and they pull skilled trades the way data centers do.
The concentration risk
Here’s the uncomfortable part. When two sectors carry most of a market’s growth, the market is fragile. Data centers and factory reshoring are both riding specific bets, on AI demand and on domestic-manufacturing policy, and either could cool. A builder whose backlog is all chip fabs and hyperscale halls looks diversified until you notice both depend on the same handful of capital-spending decisions.
For now, the factory boom is real and welcome, and it’s the reason industrial contractors are quoting into 2028 while their commercial counterparts chase scraps. Just don’t mistake two booms for a broad recovery. The AIA’s own panel expects overall nonresidential spending to slip slightly in 2026. Take out the halls full of servers and the plants full of robots, and the rest of the market is still waiting for its turn.