Which construction cost is rising fastest in 2026?

Steel is the sharpest mover — up about 7.0% year over year and roughly 4.9% in the last 90 days — followed by lumber and materials broadly. Construction labor keeps climbing steadily at about 4.4% a year.

How Much Have Construction Costs Risen in 2026?

Q: How much have construction costs risen in 2026?

As of the most recent data (through May 2026), U.S. construction materials are up about 5.6% year over year. Framing lumber is up about 4.2%, steel (rebar and structural) about 7.0%, and construction labor about 4.4%, at roughly $41.20 per hour.

Updated June 2026 · data through May 2026 · sources: U.S. Bureau of Labor Statistics

As of the most recent data, U.S. construction materials are up about 5.6% year over year. Framing lumber is up ~4.2%, steel ~7.0% (the fastest mover), and construction labor ~4.4%, now around $41.20/hour. In short: costs are still grinding higher, not settling — and builders pricing off last year's numbers are bidding low.

The 2026 numbers at a glance

Based on BLS Producer Price Index commodity series and construction average hourly earnings, accessed via FRED.

What's driving each one

Cost input	90-day	Year-over-year
Construction materials (all)	+3.0%	+5.6%
Framing lumber	+3.3%	+4.2%
Steel — rebar & structural	+4.9%	+7.0%
Construction labor (loaded)	+1.2%	+4.4%

Steel is the story of 2026. Rebar and structural steel are up about 7% on the year and nearly 5% in just the last quarter — the sharpest move of any major input. Any steel scope you priced more than a quarter ago is likely under.

Lumber has firmed back up. After a soft winter, framing lumber has climbed ~4% year over year and is trending higher again heading into summer starts.

Materials broadly are outpacing inflation. The overall construction-materials index is up ~5.6% — faster than general consumer inflation — so "hold last year's numbers" quietly erodes margin across the whole bid.

Labor never stops. Loaded construction wages aren't spiking, but they rise every year — ~4.4% again — and skilled trades remain scarce.

What it means for your bids

National averages aren't your real problem — your own current costs are. Most builders price from a senior estimator's memory and a spreadsheet that's months out of date. On an $8–40M book of work, even a fraction of these percentage moves, carried into a fixed-price bid, is real margin lost per job.

Two practical moves: re-price any line last quoted more than 90 days ago (especially steel, lumber, and subs), and put a material-escalation clause on the volatile line items so you're not eating the difference between signing and purchase.

Track it every month

Datum publishes the Residential Construction Cost Index monthly — the latest moves in materials, lumber, steel, and labor, free. And Datum builds the same intelligence from your own invoices, quotes, and payroll, so your bids run on numbers you can trust.

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