Wage growth for residential building workers continued to lose momentum in the second quarter of 2026, with inflation-adjusted pay now falling year over year even as nominal wages barely rise, according to an analysis published Aug. 10, 2026, by the National Association of Home Builders.
Citing U.S. Bureau of Labor Statistics data, NAHB economist Jing Fu found that average hourly earnings for residential building workers rose just 1.0% year over year in June 2026, to $39.74 an hour. Adjusted for inflation, real wages fell 2.4% over the same period β meaning workers in the sector are losing purchasing power even though their paychecks are still nominally growing. NAHB’s analysis covers all employees in the residential building industry, including workers on new single-family construction and residential remodeling projects, but excludes specialty trade contractors, who are tracked separately.
The slowdown marks a sharp reversal from the post-pandemic boom in construction pay. Nominal wage growth for the sector peaked at 9.4% in mid-2024, while real wage gains peaked around 6.2% during the same period, as builders competed aggressively for scarce labor amid a surge in housing demand. NAHB described the current trend as an extension of “the cooling trend that emerged after the strong wage gains of the post-pandemic period,” reflecting softer housing construction activity and weaker labor demand more broadly.
Residential building wages also continue to trail pay in several competing sectors, per the analysis: manufacturing workers earn 8.2% more on average, at $36.74 an hour, and transportation and warehousing workers earn 22.1% more, at $32.55 an hour. NAHB found one of the few sectors residential building still out-earns is mining and logging, where wages run 5.4% lower, at $42.01 an hour.
That wage gap matters for builders because residential construction competes directly with other blue-collar industries for the same pool of workers. When wage growth in residential building lags sectors like manufacturing and transportation, as it now does, contractors can find it harder to attract and retain workers during periods when construction demand does pick back up, even if overall labor supply in the economy is loosening.
What it means: The wage data lines up with other signs that residential construction labor markets have cooled even as pockets of construction demand elsewhere in the economy β particularly data centers β remain red-hot. RealtyWire has reported on construction job openings jumping as data center projects pull labor away from housing, a dynamic that helps explain why wage growth in residential building specifically is cooling even as construction labor overall stays in high demand: workers and contractors have incentive to shift toward better-paying non-residential and infrastructure work. That shift, combined with the broader softening in the labor market reflected in July’s weak national jobs report, suggests homebuilders may face less wage-driven cost pressure going into 2027 than they did during the tightest years of the post-pandemic labor market β a modest silver lining for an industry otherwise contending with soft demand and elevated mortgage rates.
