Highway, Street & Bridge Construction NAICS 237310

May 9, 2025 - Highway, Street Spending to Remain Steady Through 2029

• North American construction and engineering spending on highways, streets, and bridges in 2025 is expected to grow by 3% and post stable annual growth through 2029, according to FMI’s second-quarter 2025 North American Engineering and Construction Outlook. While funding authorized under the Infrastructure Investment and Jobs Act (IIJA) is set to expire after fiscal 2026, FMI suggests that unspent IIJA funding unrelated to infrastructure could be reallocated to pay for highway, street, and bridge projects. Construction and engineering spending for highway and street projects is forecast to increase by 2% in 2026, 3% in 2027, and 4% in 2028 and 2029.
• In mid-April, a federal judge in Rhode Island ordered the Trump administration to reinstate already-allocated funding from the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA), according to Manufacturing Dive. President Trump froze IIJA and IRA funding via executive order on his first day in office. The judge ordered the Departments of Energy, Interior, Agriculture, and Housing and Urban Development to release the frozen funding as the case plays out in court. In March, six nonprofits sued the agencies to gain access to frozen funding. The ruling unblocks funding for all awardees nationwide.

• During a recent earnings call with analysts, Granite Construction CEO Kyle Larkin said that so far, the company had not felt much impact from the Trump administration’s tariff policies, according to Construction Dive. However, Larkin suggested if the tariffs persist, they will likely result in higher costs for equipment, repairs, and parts. Larkin noted that his firm, which derives significant revenues from roadbuilding and aggregates, continues to see strong demand stemming from funding by the Infrastructure Investment and Jobs Act (IIJA). While the Biden-era IIJA has come under fire by the Trump administration, Larkin said bipartisan support for additional infrastructure is strong, and that another bipartisan infrastructure bill was possible.
• The total value of nonresidential construction put in place decreased 0.5% in March compared to February, according to the US Census Bureau. Highway and street spending declined 0.5% in March compared to February and was down 2.5% year-over-year. Associated Builders and Contractors Chief Economist Anirban Basu said, “Data center investments, which accounted for more than 70% of the increase in private nonresidential construction spending between March 2024 and March 2025, are perhaps the only remaining source of industry momentum. Manufacturing construction, while still elevated, has wavered in recent months. Most commercial segments remain subdued under the weight of high borrowing costs and tight lending standards. Residential construction continues to slide.”