REPORT

Today's Construction Economy
Q2 2025


By Brandon Michalski

Principal, Construction Economist, MOCA Systems, Inc.


U.S. construction is beginning to feel the delayed impact of rising rates, tightening capital, and trade uncertainty, with
growth expected to slow and costs to rise in 2025. MSI Economics forecasts elevated risk-driven inflation led by
workforce constraints and material availability. For the rest of 2025, contractors are expected to rely more on backlog
and to seek escalation clauses to offset rising material prices. While strength persists in data centers and publicly backed
sectors, uncertainty in federal funding could slow delivery in the latter. The direction of interest rates and material pricing
will shape the second-half outlook. The price paid for new nonresidential construction is expected to increase by 2.9%
year over year (YoY) 2025, vs. just 0.1% revised in 2024.


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Meet the author

Brandon Michalski
Principal, Construction Economist at MOCA Systems


Brandon Michalski is the lead economist for MOCA Systems, Inc., a leading owner’s representative firm providing program and project management services. Brandon's decade in the mining and heavy construction industries provides a foundation for subject matter expertise. He holds a Master of Science in Applied Economics from Johns Hopkins University in Baltimore, MD as well as Bachelor's Degrees in both Mining Engineering and Biology from West Virginia University in Morgantown, WV. Brandon currently lives in Chicago, Illinois with his family and enjoys hiking and camping.