Alabama’s commercial construction industry generated more than $20 billion in economic activity and supported more than 223,000 jobs in 2023, according to a newly released economic impact study commissioned by Associated Builders and Contractors of Alabama.
ABC of Alabama represents merit-shop contractors and construction firms across the state and advocates for the industry’s workforce and economic interests.
The study, prepared by economist M. Kevin Deravi, found that the commercial construction industry’s economic impact reached $20.1 billion in output, generated $13.5 billion in earnings and supported the equivalent of 223,167 full-time jobs across the state in 2023.
Governor Kay Ivey said Alabama’s recent economic growth has relied heavily on the construction sector.
“Since I took office in 2017, Alabama has attracted more than $69 billion in new investments and created over 100,000 jobs,” Ivey said. “Our state continues to grow, and the commercial construction workforce has been essential in making that progress possible.”
The study found that commercial construction directly generated $11.1 billion in output in 2023, employed nearly 70,000 workers and paid more than $5.5 billion in payroll. Compared to 2021, direct output increased by about 18 percent, while employment grew by about 5,000 jobs.
“The scale of this industry’s impact is remarkable,” said Ed Hauser, chairman of the ABC of Alabama Board of Directors and senior vice president of Brasfield & Gorrie. “Commercial construction generates more than $20 billion in economic output and supports nearly a quarter-million jobs. Those numbers reflect the critical role our industry plays in Alabama’s continued growth.”
According to the report, commercial construction represents about 4.7 percent of Alabama’s gross domestic product.
“Commercial construction is one of the state’s major economic engines,” Deravi said. “Any industry contributing nearly 5 percent of Alabama’s GDP is a significant force in the state’s economy.”
The study also found that the industry generated an estimated $746 million in state tax revenue in 2023, including $401 million in income taxes, $294 million in sales and use taxes and about $50 million in utility taxes.
Deravi said growth should continue. Based on surveys of ABC of Alabama members and economic forecasting models, total economic output is projected to reach about $16.6 billion by 2025.
Former ABC of Alabama Chairman Tim Harrison, president of Harrison Construction, said the tax revenue generated by the industry often receives less attention than employment and project totals.
“Construction’s economic impact extends well beyond the jobsites,” Harrison said. “The revenue generated by this industry helps support schools, infrastructure and other public services that benefit communities throughout Alabama.”
Jeff Carrico, an ABC of Alabama board member and president of White-Spunner Construction, said the report provides a clearer understanding of the industry’s influence on the state’s economy.
“Alabama has a strong construction sector that includes general contractors, specialty contractors and trade firms across the state,” Carrico said. “Studies like this help quantify that impact and provide valuable information for business leaders, policymakers and the public.”
While the report projects continued expansion, it also identifies workforce shortages as a challenge facing the industry. Researchers noted an aging workforce, growing demand for construction projects, declining participation in vocational training programs and competition from other industries for skilled workers.
The study also noted the construction industry’s dependence on immigrant labor, particularly in trades such as carpentry, roofing, drywall installation and painting, and said immigration policies could influence the future of Alabama’s workforce.
