Commercial Equipment Rental and Leasing NAICS 5324

Apr 6, 2026 - Civil Infrastructure Backlogs Strong, Labor Remains an Issue

• Construction equipment leasing firms could see improved demand amid steady growth in the civil infrastructure backlog. The Q1 2026 Civil Infrastructure Construction Index (CICI) report by construction consulting firm FMI shows the civil construction industry entering a period of steady expansion. The CICI index rose to 52.1 in Q1 2026 from the previous quarter, and the backlog index increased to 57.3 from 52.8, signaling strong demand. Public funding and local project pipelines continue to support growth, particularly in transportation, water, and utilities, reinforcing a multiyear infrastructure cycle. However, the industry’s primary challenge is execution, not demand. Labor shortages, turnover, and productivity constraints are limiting firms’ ability to deliver work profitably, even as materials costs stabilize. As a result, civil contractors face mounting pressure to balance rising workloads with workforce capacity, operational discipline, and margin protection. Workforce shortages could support the leasing of labor-saving equipment.
• The Equipment Leasing and Finance Association’s (ELFA) Monthly CapEx Finance Index (CFI) showed new business volume reached a value of $11 billion in February 2026, down 4.7% from the month before. On a year-over-year basis, new business volumes increased 14.2 % in February. ELFA CEO and President Leigh Lytle said, "Every industry segment saw healthy growth over the last year, with independent providers leading the way with another surge in February. This survey was conducted before the conflict in Iran and the March FOMC meeting, and those could cause more bumps in the first half. However, financial conditions and credit approvals remain strong. These are signs that the sector can withstand additional shocks."

• US manufacturing activity expanded in March 2026 for the third consecutive month, according to the Institute for Supply Management (ISM). The ISM’s Purchasing Managers Index (PMI) in March rose to 52.7% from a reading of 52.4% in February. A reading above 50% indicates manufacturing expansion. March's New Orders Index decreased by 2.3 percentage points to 53.5%. The March Production Index rose 1.6 percentage points to 55.1%. Individual verbatim respondents to the ISM survey suggested that while some manufacturers are feeling relief from the US Supreme Court's removal of the Trump administration's emergency-related tariff regime, many are concerned that the conflict in the Middle East poses headwinds for supply chains, including longer lead times, higher costs, and container delays. Manufacturing activity is a demand driver for equipment rental and leasing.
• US equipment rental revenue, which includes the construction/industrial and general tool market segments, is expected to rise in 2026, but at a slower pace, according to a recent forecast by the American Rental Association (ARA) and data partner S&P Global. After posting revenue of $80.6 billion in 2025, equipment rental revenue is expected to increase by 2.8% in 2026 and reach $82.9 billion. Demand for construction and industrial equipment (CIE) is forecast to rise 1.6% in 2026, and general tool equipment investment is expected to rise by 4.1%. However, geopolitical and financial challenges are weighing on business and consumer confidence, which is slowing equipment rental demand. Residential construction is expected to drop 0.6% in 2026, while nonresidential construction will rise only 0.6%. US manufacturing activity is forecast to remain flat, rising just 0.3% in 2026.