Sean Szatkowski, executive vice president and general manager of Skanska USA Building in New York, tells GCR about labour and material shortages, tariffs and other challenges.
Skanska USA has recently published a paper on construction market trends for winter 2026, available to read here.
How is Skanska fairing in New York and the US more broadly?
Construction in New York City presents a unique set of challenges. Rising material costs, limited site access, aging infrastructure and the need for close collaboration with communities and city agencies all demand careful planning and coordination. Currently trends in city construction focus on expanding mass transit, developing mixed-use spaces and integrating climate-resilient design practices.
Across the five boroughs, Manhattan and Queens are experiencing the most significant development activity, including major healthcare, transportation and mixed-use projects. This construction growth is fuelled by sustained investments in infrastructure, healthcare, housing and tourism, which continue to attract funding despite rising costs because of their long-term economic and community impact.
Nationwide, Skanska is expanding its presence in infrastructure, life sciences, data centres and other high-impact sectors, enabling the company to navigate market fluctuations while delivering meaningful projects that benefit communities.
At the national level, sectors such as data centres, semiconductor manufacturing, and infrastructure are expanding at a faster pace, driven by long-term demand for technology, energy, and public assets. Those projects are helping support overall construction activity even as broader growth remains modest.
Despite ongoing economic pressures, the outlook for construction in New York and across the US remains strong, supported by strategic investments, a focus on resilience, and continued development that improves urban connectivity, healthcare, housing, and community infrastructure.
The Associated General Contractors of America (AGC) has reported that contractors’ overall sentiment has “dampened notably compared to last year”. How is the market, both for Skanska and construction in general?
Smaller firms are feeling pressure through rising material costs, labour availability and complex permitting processes due to tighter margins, while larger companies manage multiple bigger projects simultaneously under similar constraints.
Success in this environment depends on proactive risk management, strong supplier partnerships and close coordination with local agencies and communities to keep projects on schedule and budget.
Skanska’s Strategic Supply Chain team plays a critical role in supporting clients through these challenges. By working directly with project teams and stakeholders, we provide real-time market insights, sourcing strategies, and logistical solutions to mitigate risk and optimise project outcomes.
Have you encountered specific sectors growing or contracting, either regionally or nationally?
Growth remains uneven. Certain markets are clearly outperforming, particularly those benefiting from strong infrastructure, power availability and sustained public investment.
Many traditional commercial real estate segments have softened, especially retail, office, certain manufacturing projects and residential construction continues to face pressure from high borrowing costs and affordability challenges. In dense urban markets like New York, however, long-term needs around transportation, housing, healthcare, and climate resilience continue to drive steady activity.
Public and institutional projects, including infrastructure, healthcare and education, remain resilient and in some cases continue to grow, driven by sustained government funding and long-term capital planning. Technology-driven developments, such as data centres and semiconductor facilities, are also expanding rapidly in response to strong demand for digital and cloud infrastructure.
Tariffs are reinforcing higher material costs, longer procurement timelines and greater pricing volatility across the construction market
High borrowing costs, affordability constraints, and cautious private investment are limiting growth.
Overall, expansion is concentrated in public, institutional, and technology-focused projects, while much of the private residential and commercial market remains subdued.
The AGC says that 70% of firms report being affected by tariffs in 2025. How have tariffs impacted Skanska?
Across the market, tariffs are having a noticeable impact on construction costs and supply chains. Elevated tariffs on steel and aluminium continue to contribute to upward pricing pressure and uncertainty.
Domestic steel prices have risen through 2025 and into 2026, even though overall capacity utilisation has remained relatively steady. Strong demand from data centres, semiconductor manufacturing and large industrial projects has absorbed much of the available fabrication capacity, which has extended lead times and created additional constraints, particularly for electrical infrastructure equipment.
This increased demand is driving higher costs and longer lead times for many products in the electrical and mechanical industries. Much of this escalation is directly linked to the rapid growth of the data centre construction sector. For example, HVAC cooling equipment such as chillers, electrical equipment including switchgear and emergency generators, and commodity items like piping and wiring are all experiencing significant demand and price increases due to their critical role in data centre construction.
Aluminium tariffs have also materially affected the market. The benchmark cost has increased sharply since early 2025, significantly raising costs for aluminium-intensive products such as curtain wall systems and other building envelope components. In response, many manufacturers and suppliers have announced price increases, which are now being reflected in project budgets.
Overall, tariffs are reinforcing higher material costs, longer procurement timelines and greater pricing volatility across the construction market. These pressures are prompting owners and contractors to place greater emphasis on early procurement, alternative sourcing strategies and more conservative cost escalation and schedule contingencies at the market level.
Have you been affected by labour issues or material shortages?
Across the board, companies are dealing with rising material costs, labour availability and complex permitting processes.
Skilled trades, particularly in electrical and mechanical work, are increasingly tight, especially as large-scale data centre and infrastructure projects accelerate. Over 2025, the industry added only 14,000 jobs, a minimal increase of 0.2%, even as the unemployment rate held steady at 4.2%.
Material shortages plus tariff-driven cost increases are also affecting the market. High demand for specialised components and fabrication capacity has extended lead times. To manage these pressures, contractors are relying on advanced planning, diversified sourcing, and flexible scheduling strategies to keep projects on track, minimise delays, and control costs.
With two-thirds of US firms concerned about a 2026 recession, has the US’ ongoing economic uncertainty impacted Skanska?
Factors such as high borrowing costs and tariffs have made private investment more cautious, particularly in residential and traditional commercial projects. Large-scale public and institutional projects, including infrastructure, healthcare and education, benefit from stable funding sources, though they are still influenced by long-term planning and regulatory considerations.
These conditions are affecting project timing, financing decisions, and material costs, resulting in selective growth rather than broad-based expansion across the market.
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