What the Infrastructure Investment and Jobs Act Means for Construction

The Infrastructure Investment and Jobs Act (IIJA), a monumental legislation signed into law on Nov. 15, 2021, allocated $1.2 trillion toward improving America’s infrastructure over the next eight years. As we enter 2025, the ripple effects of this legislation are beginning to take center stage, profoundly impacting the construction industry.

Let’s explore how the IIJA will influence construction trends, opportunities and challenges in the coming year.

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Boost in Construction Projects

The IIJA has earmarked billions for roads, bridges, public transit, airports, water systems, broadband expansion and energy infrastructure. Expect significant funding for:

• Highway and bridge repairs: Many states will see large-scale projects break ground to address deteriorating infrastructure.
• Public transit modernization: Investments will fund expanded rail networks and improved urban transit systems.
• Broadband expansion: Rural areas are often overlooked, but with IIJA, they will see an increase in broadband construction projects, connecting underserved communities.

This surge in funding ensures steady work for construction firms, subcontractors and suppliers, creating a robust pipeline of major and minor projects for years to come.

Increased Demand for Skilled Labor

One of the construction industry’s greatest challenges will be meeting the growing demand for skilled labor. The IIJA is expected to create hundreds of thousands of jobs, but the construction workforce is already grappling with a shortage of qualified workers. Companies must invest in workforce development through:

• Apprenticeships and training programs: Collaborate with workforce development initiatives to attract, upskill and retain new talent, including carpenters, electricians and heavy equipment operators.
• Technology adoption: Leverage tools like automation, robotics, drones, the Internet of Things (IoT) and artificial intelligence (AI) to offset labor shortages and improve efficiency.

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Supply Chain and Material Challenges

Although funding from the IIJA is a boon, the construction industry will face some supply chain disruptions and material shortages.

• Material shortages: The construction industry may continue to grapple with supply chain disruptions and potential material shortages, particularly for materials like steel, concrete and lumber.
• Price volatility: These supply chain issues could lead to increased material costs and project delays, impacting project budgets and timelines.

To offset these challenges, firms may need to reduce dependency on global supply chains, substitute scarce materials with more readily available options and use project management software to streamline procurement and minimize delays.

Focus on Sustainability and Green Construction

In 2025, sustainability will be more than a buzzword – it’ll be a mandate. Construction firms will need to:

• Incorporate green building practices: Utilize energy-efficient building materials and renewable energy sources.
• Adapt to new regulations: Meet stricter environmental standards for federally funded projects.
• Invest in renewable energy infrastructure: From solar panel installation to wind farms, clean energy projects will become a significant focus.

How to Stay Ahead in 2025

Construction companies must adapt to legislative changes to remain compliant and competitive. By staying informed and proactive, industry professionals can turn these changes into opportunities for growth and innovation.

Here are some steps to prepare:

• Monitor legislation: Stay informed about updates to IIJA and new bills by subscribing to industry newsletters and updates, including AGC.
• Invest in training: Ensure your workforce is prepared for new standards by investing in upskilling programs.
• Adopt sustainable practices: Incorporate green building materials and energy-efficient designs to align with environmental regulations.
• Leverage technology: Use emerging construction technologies to meet compliance standards and improve project efficiency.