Construction market outlook
Top three market challenges
Labor shortages and skilled workforce gaps
Material lead times
Entitlement and permitting timelines
To ensure optimal viewing of Figure 3, it is highly recommended to view this page on a desktop or laptop screen rather than a mobile or tablet device. The larger screen size provides superior clarity and detail, facilitating a better understanding of the presented information.
Figure 3:
Key construction performance indicators - movement (%) or index value where stated
Current period
Previous period
Nevada construction output (YoY %)
-2.6
December 2023 – December 2024
-4.0
September 2023 – September 2024
Nevada construction output (QoQ %)
1.6
September 2024 – December 2024
0.3
June 2024 – September 2024
Las Vegas construction employment growth (YoY%)
0.7
February 2025
-0.4
January 2025
Las Vegas construction wage growth (QoQ%)
0.4
February 2025
0.7
January 2025
Source: Bureau of Economic Analysis, Bureau of Labor Statistics, Apr 2025
The construction sector in Nevada has been among the weakest in the United States, with a year-on-year decline of -2.6 percent in the fourth quarter of 2024. This follows a 4 percent drop in the third quarter. The chart highlights that Nevada's contraction stands out compared to other states, many of which experienced moderate to strong growth. National growth stands at 4.5 percent with states such as Kentucky, Louisiana, and Indiana recorded the highest annual growth in construction output, further underscoring Nevada’s divergence from the broader trend.
Source: Bureau of Economic Analysis, Apr 2025
However, this downturn in Nevada is primarily a result of normalisation and correction after a decade of robust growth leading up to 2020. Despite the recent declines, construction output remains elevated and has outperformed other major states in cumulative growth since 2013, totalling US$13.6bn in Q4 2024, supported by a diversified portfolio of projects in healthcare, hospitality, and housing.
Source: Bureau of Economic Analysis, Apr 2025
The Infrastructure Investment and Jobs Act will direct over $4bn to Nevada, aiming to revitalize the state’s economy and support the construction market. Key initiatives will focus on improving roads, public transportation, water infrastructure and expanding access to high-speed internet.
On the other hand, the private commercial sector has adopted a more cautious stance, with some projects deferred amid uncertainties around interest rates and forthcoming policy directions under the Trump Administration. The hospitality and mixed-use sectors are the exception to this trend, with strong growth projected in the coming years, reflecting strategic priorities aligned with Southern Nevada's core strengths in tourism and entertainment.
The healthcare sector is also expected to perform well in the outlook, having grown significantly in recent years. Investment continues to increase in the sector, which is being supported by key infrastructure developments, a shifting demographic profile, and a robust healthcare education and research environment.
In general, population growth remains one of the key drivers of construction demand in Las Vegas. Projections from the University of Nevada, Las Vegas (UNLV) anticipate growth reached 1.6 percent in 2024, and is forecasting 1.4 percent in 2025 and 2.0 percent in 2026 before stabilizing. These figures are consistently higher than the national average, reflecting the region’s strong appeal. This ongoing expansion, driven by new employment opportunities and the region’s growing popularity as a destination for families and retirees, is expected to support demand for social infrastructure and housing, and will driver stronger economic activity.
Business sentiment reflects optimism, as UNLV’s Southern Nevada Business Confidence Index shows positive expectations for construction activity. Over half of respondents predict growth, with the index reaching a quarterly high of 136.2. Despite challenges in financing and private commercial starts, the region’s construction outlook is bolstered by a robust pipeline of diverse projects, strategic sectoral shifts, and supportive demographic trends.
Key considerations for construction in Las Vegas
On the strip
- Logistics complexity: Tight site constraints necessitate just-in-time deliveries and careful material staging.
- Premium costs and scheduling: High labor and material costs, limited work hours, and union labor requirements add to project challenges.
- Regulatory and design challenges: Many projects involve out-of-state design and project management teams, which may be unfamiliar with local building codes and permitting processes.
Off the strip
- Jurisdictional complexity: Approval processes, timeline and permitting requirements vary across different municipalities.
- Design and compliance: Projects must meet specific zoning, design, and environmental requirements.
- Vendor and quality control: Ensuring consistent quality from vendors is a challenge.
Infrastructure to support the region’s growth
To support the region's robust population growth, governments have significantly increased investments in infrastructure, with several major projects in the pipeline. Enhancing transportation and accessibility across Las Vegas is a primary focus. Plans include upgrading existing transport routes, expanding current transport services, and exploring new modes of transportation in the region.
Key projects include:
- Interstate 15 Corridor improvement: Upgrading and expanding the highway to reduce congestion and improve safety.
- High-speed rail: Developing a high-speed rail link between Las Vegas and Southern California, aimed at reducing travel time and easing road traffic.
- Light Rail Transit (LRT) system: Introducing a new light rail system to improve connectivity within the city and reduce reliance on cars.
- Bus Rapid Transit (BRT) expansion: Expanding the BRT network to provide faster, more reliable public transport options.
- Bicycle and pedestrian pathways: Enhancing and extending pathways to promote alternative, eco-friendly modes of transport and improve pedestrian safety.
- Airport upgrades: Expanding and modernizing Harry Reid International Airport to accommodate increased passenger traffic and enhance overall efficiency.
- Air taxis: The Federal Aviation Administration (FAA) has issued a final ruling establishing a new aircraft category called eVTOL (Electric Vertical Take-Off and Landing). This category permits the use of emerging electric-powered air taxis that can take off and land vertically while flying like fixed-wing planes. Following this ruling, there is expected to be increased focus on utilizing these aircraft and advancing their technology in the coming years.
These infrastructure projects aim to not only support the growing population but also to drive economic growth, improve the quality of life for residents, and position Las Vegas as a leader in modern urban transportation.
Renewable energy and sustainability initiatives
Las Vegas continues to lead in renewable energy adoption, with ongoing projects aimed at supporting the region’s growth while advancing Nevada’s clean energy goals. The state has committed to generating 50 percent of its electricity from renewable sources by 2030, building on existing efforts that have already brought renewable energy use to 37 percent.
The city of Las Vegas became the first large US city to power all government buildings, streetlights, and facilities with 100 percent renewable energy in 2016. Many resorts on the Las Vegas Strip now rely on increasing amounts of renewable energy, either through NV Energy or private solar projects, such as MGM Resorts International’s dedicated solar array. In 2024, Las Vegas hosted the first Super Bowl powered entirely by renewable energy.
The Greenlink West transmission project will enhance connectivity between Southern and Northern Nevada. Spanning 350 miles from Las Vegas to Yerington, the 525-kilovolt line will have a capacity of up to 4 gigawatts—enough to power more than 4.8 million homes. A complementary project, Greenlink North, will add a 210-mile transmission line linking Yerington and Ely, creating a statewide energy loop with the existing One Nevada transmission line. Construction is set to begin in early 2025, with both projects expected to be operational by spring 2027.
Solar development is expanding rapidly in rural Nevada counties. As of June, Nevada had 13 operational solar energy facilities covering approximately 20,000 acres of Bureau of Land Management (BLM) land, with a combined capacity of 2,000 megawatts.