The Construction Economist — July 31, 2026

Turner's cost index climbs 5.15% on labor · Q2 GDP slows to 1.5% · Congress moves to extend the IIJA · Data centers outbid home builders for land · Steel imports fall as the overcapacity fight sharpens

Top News

Turner's Building Cost Index Rises 5.15% as Skilled-Labor Demand Re-Accelerates Escalation Turner Construction Company · ~2 min read

Turner Construction's Building Cost Index — the contractor's 80-year benchmark for nonresidential building costs — reached 1552 in the second quarter of 2026, up 1.44% from Q1 and 5.15% from a year earlier, its fastest yearly increase since 2023. Turner says demand remains strongest in data centers, semiconductors, advanced manufacturing and mission-critical facilities, concentrated in the Midwest and Southeast, and names the availability of skilled mechanical and electrical labor as the industry's biggest challenge.

What it means: This is demand-pulled escalation — data-center and fab work bidding scarce mechanical and electrical trades away from everything else — and it has now compounded for six straight quarters, from a 3.4% yearly pace in late 2024 to 5.15% today. Escalation allowances anchored on 2024's 3.9% average are already thin on out-year budgets; Turner's own watch items for the back half are material costs and tariff policy stacking on top of the labor push.

Q2 GDP Grows at a 1.5% Annual Rate, Down from 2.1% in Q1 U.S. Bureau of Economic Analysis · ~3 min read

Real gross domestic product increased at a 1.5% annual rate in the second quarter of 2026, according to the BEA's advance estimate released July 30, down from 2.1% growth in the first quarter. Increases in consumer spending, investment and exports drove the quarter, partly offset by a decrease in government spending.

Project Finance & Economics

Cushman & Wakefield: Data Centers Are Reshaping Industrial Demand, Jobs and Local Revenue Connect CRE · ~3 min read

A new Cushman & Wakefield report, "From Megawatts to Multipliers: The Data Center Effect on Industrial Demand, Jobs and Local Revenue," argues that data-center facilities now drive effects well beyond cloud and AI capacity. The authors trace the segment's spillover into industrial land demand, local employment and municipal tax bases.

AI Data Centers Are Outbidding Home Builders for Land NAHB Now · ~3 min read

As AI has driven up demand for data processing, companies building data centers have begun bidding up prices on land parcels that had been on home builders' radar, according to the National Association of Home Builders. The competition puts residential developers head-to-head with hyperscale buyers for the same dirt.

Policy, Codes & Regulation

Congress Moves to Extend the IIJA Before Its September 30 Expiration Transportation for America · ~4 min read

With no new multi-year transportation law ready before the Infrastructure Investment and Jobs Act expires September 30, Congress is moving to extend the current law — likely for one year, potentially longer. Transportation for America outlines what an extension covers and the open question of its duration.

FTA Opens $610M Round of Bus Grants — Possibly the Last Under the 2021 Infrastructure Law Smart Cities Dive · ~3 min read

The Federal Transit Administration has made $610 million available in its latest round of transit bus grants. The round could close out five years of FTA bus investments funded by the 2021 bipartisan infrastructure law, with future funding uncertain.

Materials & Supply Chain

Steel Imports Fall 4.3% in June; Finished Import Share Holds at 16% YTD American Iron & Steel Institute · ~2 min read

The U.S. imported 2,092,000 net tons of steel in June 2026, including 1,457,000 net tons of finished steel — down 4.3% and 6.9% respectively from May, per preliminary Census Bureau data reported by AISI. Finished-steel import market share stands at 16% year to date.

AISI Rejects China's Position Paper on Steel Overcapacity as "Fundamentally Flawed" American Iron & Steel Institute · ~2 min read

AISI president and CEO Kevin Dempsey pushed back on a new position paper from China's Ministry of Commerce disputing claims of excess manufacturing capacity, stating that "global overcapacity is not, as the Ministry of Commerce's report suggests, a fiction." The exchange sharpens the trade-policy backdrop for U.S. steel pricing.

The Construction Economist — What's Moving Construction? The Economic Look-Ahead.