US construction spending is projected to increase from $2.22 trillion in 2026 to $2.85 trillion in 2031, an increase of more than $600 billion, according to a new National Construction Spending Trends Report from Merlo America and BiltData.ai. The report identifies the states, metropolitan areas and market sectors expected to drive that growth, providing contractors, equipment dealers and rental companies with data they can use to plan fleet investments, inventory, service coverage and expansion.

"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 Will Account for Nearly Half of Construction Spending

California, Texas, Florida, New York and New Jersey are projected to account for approximately 42% of U.S. construction spending by 2031. The nation's 10 largest metropolitan areas are expected to collectively represent more than one-third of total construction spending.

The New York-Newark-Jersey City metropolitan area is projected to lead the country with $230 billion in construction spending by 2031, representing approximately 8% of total US spending. Los Angeles, Chicago, Dallas-Fort Worth and Houston round out the five largest projected construction markets.

For contractors and equipment businesses, the concentration of spending provides a roadmap for where demand is expected to develop. Identifying those markets before activity peaks can help companies make investment and expansion decisions rather than responding after demand has already shifted.

Data Centers Add Another Layer of Regional Demand

The report also identifies artificial intelligence, cloud computing and digital infrastructure as major drivers of future construction activity. The top 12 metropolitan markets are projected to account for nearly 73% of US data center capacity by 2031.

That growth will create demand for site preparation, infrastructure, building construction and the equipment needed to support those projects. Dallas-Fort Worth, Washington, DC, Chicago and Phoenix are among the markets expected to remain active centers for technology-driven construction.

"AI is accelerating investment in data centers and infrastructure, but the bigger opportunity is understanding where that work is happening. 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," said Nick Mavrick, CEO of BiltData.ai.

Residential Construction Remains the Largest Sector

While technology infrastructure is reshaping demand in several major markets, residential construction is projected to remain the largest construction segment through 2031.

The report forecasts $1.026 trillion in residential construction spending by 2031, followed by $741 billion in commercial construction, $684 billion in industrial construction—including manufacturing and data center development—and $399 billion in infrastructure investment.

Together, those projections provide contractors and equipment providers with a broader view of where construction activity is expected to accelerate and where demand for equipment and services could follow.

Agricultural Markets Continue to Support Equipment Demand

Construction growth is not limited to major metropolitan areas. The report also examines 179 Bureau of Economic Analysis economic areas and identifies continued economic activity across rural markets.

The analysis found that the top 40 agricultural markets account for more than 70% of agricultural employment, reinforcing agriculture's role in the broader equipment economy and pointing to opportunities outside the country's largest construction centers.

Market Data Can Help Contractors Plan Ahead

The report is intended to help contractors, equipment dealers and rental companies shift from reacting to market conditions to planning around projected demand.

"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, ultimately supporting them to effectively plan for sustainable growth."

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 identify where future construction demand is expected to develop.

"Construction spending isn't increasing evenly across the country, and that's what makes this report so valuable," said Mavrick. "Merlo America shares our belief that businesses make better decisions when they have better market intelligence. Together, we've developed a report that helps contractors, dealers and rental companies identify where opportunity is emerging and plan for it with greater confidence."

To learn more and download a copy of the report visit www.merlo.com/usa/en/resource-hub.