Each quarter, we poll civil construction professionals nationwide to get a pulse on industry sentiment. Following an optimistic end to 2024, the results from our Post-Q1 2025 Civil Construction Confidence Poll reveal a shift: confidence is cooling as the industry adjusts to new economic and political realities.
Confidence Cools After Political Shift
At the end of 2024, civil construction optimism surged as the GOP regained control of the White House and Congress. Our Q4 poll showed 79% of professionals expecting growth, driven by hopes for deregulation, infrastructure investment, and economic expansion.
However, just one quarter later, that momentum has tempered. In Q1 2025:
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24% of respondents expect strong growth (down from 30%)
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43% predict moderate growth (down from 49%)
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22% anticipate stagnation
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11% foresee contraction
In total, growth expectations have dropped from 79% to 67%, while concern about stagnation or shrinkage has climbed from 21% to 33%.
Three Major Factors Driving Caution
The cooling sentiment isn’t random—it reflects real developments shaping the landscape.
1. Tariffs and Supply Chain Uncertainty
New tariffs introduced by the Trump administration are beginning to ripple across the industry. Construction leaders are wary of potential increases in material costs, particularly for imported steel, heavy equipment, and manufacturing components. Whether these tariffs will boost domestic production or inflate project costs remains to be seen—but the uncertainty is causing firms to tread carefully.
2. Inflation and Tight Lending Conditions
While inflation has slightly cooled (dropping from 3% in January to 2.8% in February 2025), it’s not enough to ease tight lending conditions. Access to affordable capital remains constrained, making firms more cautious about greenlighting major projects. Without clear signs of sustained economic acceleration, many construction companies are adopting a “wait and see” approach.
3. Political and Economic Policy Volatility
Policy decisions are now at the forefront of construction planning. Professionals are closely watching federal infrastructure funding, potential deregulation efforts, and broader political dynamics. Delays or uncertainty in funding and policy execution could significantly impact project pipelines over the next year.
Key Questions for the Industry
The hesitation showing up in our survey data mirrors big questions looming across the sector:
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Will federal infrastructure spending increase or plateau?
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How will tariffs impact manufacturing and industrial construction?
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Can AI-fueled demand for data center projects sustain growth?
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Will regulatory reform drive investment, or will political gridlock slow progress?
These unresolved issues are leading contractors, engineers, and developers to plan more conservatively for the remainder of 2025.
Three Key Takeaways
From this quarter’s data, three themes stand out for industry leaders:
1. Measured Optimism
Confidence hasn’t disappeared—it’s just more cautious. Firms are still moving forward but with enhanced risk management, tighter forecasting, and greater scrutiny of project viability.
2. Policy Signals Matter More Than Ever
Construction firms are increasingly responsive to federal policies around tariffs, infrastructure funding, and monetary policy. Staying informed and agile will be critical.
3. Opportunity Is Becoming More Selective
Sectors like data infrastructure, federal projects, and utilities continue to show promise. Broader markets, however, are recalibrating after last year’s surge in optimism.
Looking Ahead
While the post-election surge of confidence has cooled, opportunity remains—especially for firms willing to adapt, monitor policy changes closely, and strategically position themselves in key sectors.
Thank you to everyone who participated in the poll. Your insights help keep the civil construction community informed and better prepared for what’s ahead. Stay tuned for future updates as we continue to track trends shaping our industry.
