United States construction spending is forecast to reach $2.85 trillion by 2031, with five states expected to account for approximately 42 percent of the total, according to a new report from Merlo America and BiltData.ai.
The National Construction Spending Trends Report identifies the states, metropolitan areas and sectors expected to drive the next phase of industry growth. It is designed to help contractors, equipment dealers and rental companies anticipate where demand is likely to emerge and make more informed decisions about fleet investment, inventory, service coverage and expansion.
The report forecasts that U.S. construction spending will rise from $2.22 trillion in 2026 to $2.85 trillion in 2031 — an increase of more than $600 billion in five years. That is roughly equivalent to adding another Texas-sized construction economy by the end of the decade.
"Every business in our industry is making decisions today that will shape the next five years," said Cole Renken, general manager of Merlo America. "Whether you're investing in equipment, expanding a branch or growing a service team, understanding where demand is heading gives you a real advantage. That's exactly what this report is designed to help with."
Five States Driving Construction Growth
Merlo America photo
The report projects that Calif., Texas, Fla., N.Y. and N.J. will account for approximately 42 percent of United States construction spending by 2031, while the nation's top 10 metropolitan areas will collectively represent more than one-third of all construction spending.
The N.Y.-Newark-Jersey City metropolitan area is projected to lead the country with $230 billion in construction spending by 2031, which would account for approximately 8 percent of total spending.
For contractors, dealers and rental companies, the report provides valuable insight into where future demand is expected to emerge. Understanding regional demand before it materializes helps businesses position themselves for growth with greater confidence, rather than reacting after the market has already shifted, according to Merlo America.
Data Centers Reshaping Construction Demand
The report also highlights the growing impact of artificial intelligence (AI) on construction demand. Driven by AI, cloud computing and digital infrastructure, the top 12 metropolitan markets are projected to account for nearly 73 percent of all United States data center capacity by 2031.
For the construction industry, the rise of AI will mean more sites to prepare, more infrastructure to build and more equipment needed on the ground. Markets including Dallas-Fort Worth, Washinton, D.C., Chicago and Phoenix are expected to remain among the nation's most active technology-driven construction markets, according to the report.
"AI is accelerating investment in data centers and infrastructure, but the bigger opportunity is understanding where that work is happening," said Nick Mavrick, CEO of BiltData.ai. "Our goal is to help contractors, dealers and rental companies move beyond the headlines by turning market data into practical insight they can use to make smarter decisions about where to invest and grow."
Agriculture Central to Equipment Economy
While major metropolitan areas dominate construction spending, the report also highlights continued opportunity across rural America. Analysis of 179 Bureau of Economic Analysis (BEA) economic areas found the top 40 agricultural markets account for more than 70 percent of agricultural employment, reinforcing agriculture's importance to the broader equipment economy.
Across all sectors, the report projects construction spending will reach $1.026 trillion in residential construction, $741 billion in commercial construction, $684 billion in industrial construction, including manufacturing and data center development and $399 billion in infrastructure investment by 2031. Together, these forecasts provide businesses with a clearer picture of where activity is expected to accelerate and where demand for equipment and services is likely to emerge.
"The value of this report lies in helping businesses move from reacting to planning," said Renken. "Understanding where demand is expected to grow gives decision makers the confidence to invest in the right markets and position equipment more effectively."
The National Construction Spending Trends Report combines BiltData.ai's analysis of construction spending forecasts, metropolitan economic trends, projected employment growth, data center capacity estimates and agricultural economic indicators to provide a detailed view of where future demand is expected to develop, according to Merlo America.
"Construction spending isn't increasing evenly across the country, and that's what makes this report so valuable," said Mavrick.
To access the full report, visit Merlo's Resource Hub: merlo.com/usa/en/resource-area/
