In the first quarter of 2026, wage growth for residential building workers was sluggish, which was indicative of the ongoing weakness in housing construction activity and the easing of labor demand.
Both nominal and inflation-adjusted wage gains have further moderated, as indicated by the most recent data from the U.S. Bureau of Labor Statistics.
This transition from the rapid post-pandemic expansion to a slowing labor market is evident.
The average hourly earnings (AHE) of residential building workers increased by 2.1% year over year in March 2026, a significant decrease from the 9.4% peak attained in mid-2024 and a continuation of the broader cooling trend that was observed throughout 2025—in nominal terms.
The year-over-year decline in real wages in March 2026 was 1.2% after accounting for inflation, suggesting that wage gains have not kept pace with broader price increases.
The real wage growth rate experienced a temporary increase in 2024, reaching a zenith of 6.2%.
However, it has since weakened in conjunction with the decline in residential construction activity.
Simultaneously, the number of vacant and unfilled positions in the construction sector has continued to decline, which is in line with the slower employment of construction workers and the weaker housing demand.
In comparison to other industries, residential building laborers’ wages remain competitive, despite the slowdown in wage growth:
- $8.4% more than the manufacturing sector ($36.54 per hour)
- 22.4% more than the transportation and warehousing sector ($32.34 per hour)
- Lower by 3.6% than the mining and forestry sector ($41.10 per hour)
NOTE: The data utilized in this document pertains to all employees in the residential building industry. New single-family housing construction (excluding for-sale constructors) and residential remodelers are both included in this category; however, specialty trade contractors are not.
[Read more about this topic on Eyeonhousing.org]