What the Labor Shortage Means for Construction Bidding in 2026

Briefly:

• Labor shortages will make bidding riskier by 2026, with 6–8% annual wage hikes, longer timelines (10–15% labor float), and extra pricey extra time.
• Retirements, lack of younger employees, and strict immigration legal guidelines contribute to the scarcity.
• To remain worthwhile, contractors should plan for greater prices, add labor clauses, and improve scheduling time in bids.
• Contractors who adapt their bidding methods now are finest positioned to reach the approaching years.

You’ve in all probability seen that it’s gotten tougher in recent times to fill open roles. The truth is, nine in ten contractors have openings for commerce employees that they will’t fill. That’s an enormous downside, particularly for the reason that business wants to rent roughly 723,000 workers per year to maintain up with the calls for.

Nevertheless it isn’t as a result of there’s much less work. Private and non-private initiatives are always added to mission databases like ConstructConnect® Project Intelligence day-after-day. The true downside is that the variety of certified individuals simply doesn’t exist. This subject is getting greater yearly, which implies the hole simply retains rising. 

Why the Scarcity?

An enormous cause for the labor hole is that many expert employees are heading towards retirement. Proper now, one in 5 development employees is 55 or older. The common age for a talented tradesperson is sort of 43, and it’s solely going up.

Because the skilled employees are on the point of retire, there aren’t sufficient young people entering the construction workforce. If development corporations don’t begin getting inventive to attract young workers, like recruiting by way of social media or apprenticeship programs, they’ll face challenges in 2026 and past.

And that’s not all. Stricter immigration rules have put further pressure on the development labor market. One-third of development companies say federal immigration actions have precipitated mission delays. 

Easy methods to Change Your Bids in 2026

Given these challenges, you’ll want to alter the way you bid on jobs. Listed below are three steps you may take to account for the brand new realities of the labor market.

1. Assume Your Labor Prices Will Go Up

Wages are going to keep climbing. In your 2026 development bids, you want to plan for labor costs to go up by 6-8% each year. If you happen to bid any decrease, it’s probably you’ll find yourself shedding cash.  

To guard your small business, embrace labor escalation clauses in your contracts. That is only a means of claiming if labor prices go up, your worth goes up too. Tie it to official authorities numbers so the proprietor is aware of you’re not simply making it up. Some house owners would possibly even offer you further time on the schedule in the event that they know employees are laborious to search out. 

2. Add Further Time to Your Schedule

Begin right now by studying extra concerning the present market. Download our free comprehensive Labor Guide to beat labor challenges and keep aggressive within the business.