PHCC Outlook Flags Labor, Tech, and Consolidation as Key Forces in 2026
Key Highlights
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Labor reality check: Slower hiring growth won’t ease the skills gap—workforce strategy remains mission-critical
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Where the work is: Remodeling, infrastructure, and data centers offer steadier opportunities than new construction
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Efficiency edge: AI and digital tools are becoming practical necessities, not future experiments
The Plumbing-Heating-Cooling Contractors Association (PHCC) has released its Environmental Scan: 2026 Outlook for the P-H-C Industry, providing plumbing, heating, and cooling contractors with a strategic look at the economic, workforce, and technology trends expected to shape the year ahead.
“This report helps PHCC and our partners stay ahead of trends affecting our industry,” said PHCC President Jason Pritchard. “We rely on insights like these to guide our education and workforce initiatives and help our contractor members succeed.”
Labor Constraints Continue to Pressure Contractors
The report underscores that labor availability remains one of the most significant challenges facing P-H-C contractors. While overall employment growth is projected to slow in 2026, demand for skilled trades professionals is expected to remain high due to retirements and an already-tight talent pipeline. PHCC notes that workforce development, training, and retention strategies will continue to be critical for contractors looking to sustain growth.
Construction Activity Shows Uneven Growth
According to the Environmental Scan, construction activity is forecast to grow modestly and inconsistently across sectors. Strength is expected in data centers, infrastructure programs, and residential remodeling, while broader new construction is anticipated to remain cautious. Contractors may see opportunities in specialized and renovation-driven work, even as large-scale projects vary by region and market segment.
Technology Adoption Accelerates Across the Trades
Technology continues to gain traction throughout the P-H-C industry, with more contractors exploring AI-driven tools to improve marketing, scheduling, customer engagement, and operational efficiency. PHCC identifies digital adoption as a key lever for contractors seeking to offset labor shortages, manage costs, and streamline workflows in a competitive environment.
Consolidation and Strategic Planning Remain in Focus
The report also points to continued market consolidation, fueled by private equity investment and strategic buyers. As interest rates ease, acquisition activity is expected to persist. PHCC emphasizes that resilience, forward planning, and thoughtful engagement with emerging technologies will be essential as contractors navigate cost pressures, supply volatility, and uneven demand.
To view the full report visit www.phccweb.org/news/environmental-scan-2026-outlook-for-the-p-h-c-industry.