Study: Construction Salary Growth Decreased in 2025

Industry salary report from Baker Tilly reveals the latest compensation trends and strategies in construction

CHICAGO--(BUSINESS WIRE)--Leading advisory, tax and assurance firm Baker Tilly releases the results of the 2025 Construction Industry Salary Report. The annual report, based on a survey of construction companies of all sizes and sectors, highlights compensation trends and provides contractors with a useful tool to measure their compensation strategies against peers.

This year’s report, the first since the combination of Moss Adams and Baker Tilly, shows wage growth rates slowed across participating regions, with each reporting below-average increases. Compensation based on cost-of-living adjustments also declined 7% compared to last year, however, projections for stronger wage growth in 2026 and a higher rate of companies offering merit pay and cash incentives suggest expectations for an increase in volume and demand for labor.

“Many companies are continuing to take a more cautious approach to compensation amid market uncertainty,” said Brian Kassalen, principal and construction industry leader at Baker Tilly. “Aggressive compensation strategies have slowed down in the past year, signaling that contractors are not looking to attract talent as much as previous years suggested.”

The salary report explores various aspects of compensation and benefits in the construction industry. The data detailed in the report includes salary and benefits for executives and industry-specific personnel, trends in salary and bonus structures, wage growth rates across verticals and geographic regions and strategies used to attract and retain talent. This year’s report brings new data points including expanded insights into bonus pool structures, more information around insurance and 401(K) matching, and broadened information around incentives.

“We are excited for the potential to expand the report in the coming years with the combination of Moss Adams and Baker Tilly,” said Aaron Faulk, principal at Baker Tilly. “Our broader footprint will allow us to deliver deeper insights and a more comprehensive view of compensation trends within the construction industry and throughout the United States.”

Other key findings from the 2025 Construction Industry Salary Report include:

• 79% of companies surveyed offer paid holidays to all employees — a 7% decrease from 2024 — while 8% limit the benefit to management-level employees.
• 58% of companies use cost-of-living adjustment to attract and retain talent, down 3% from last year.
• Participating companies project between 3% to 4% wage growth in 2026.
• 65% of companies reported no change to their salary strategies in the past year.
• The average salary for construction managers is $151,202.
• The average salary for construction laborers is $63,318, rising to $74,283 for respondents in California’s Greater Bay Area.

View the full, complimentary report.

About Baker Tilly (bakertilly.com)

Baker Tilly is a leading advisory, tax and assurance firm, providing clients with a genuine coast-to-coast and global advantage in major regions of the U.S. and in many of the world’s leading financial centers – New York, London, San Francisco, Seattle, Los Angeles, Chicago and Boston.

Baker Tilly Advisory Group, LP and Baker Tilly US, LLP (Baker Tilly) provide professional services through an alternative practice structure in accordance with the AICPA Code of Professional Conduct and applicable laws, regulations and professional standards. Baker Tilly US, LLP is a licensed independent CPA firm that provides attest services to its clients. Baker Tilly Advisory Group, LP and its subsidiary entities provide tax and business advisory services to their clients. Baker Tilly Advisory Group, LP and its subsidiary entities are not licensed CPA firms.

Baker Tilly Advisory Group, LP and Baker Tilly US, LLP, trading as Baker Tilly, are independent members of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 143 territories, with 47,000 professionals and a combined worldwide revenue of $7 billion. Visit bakertilly.com or join the conversation on LinkedIn, Facebook and Instagram.