UPDATE: Pennsylvania’s construction industry is facing an alarming slowdown as demand for major remodeling projects collapses. Business owners like Greg Harris, owner of G.P. Harris Construction, Inc. in Jonestown, report a dramatic decline in customer inquiries, reflecting a broader national trend in construction spending.
“Through 2023, we were extremely busy, and then it just seemed to be [people] lost the confidence to spend large amounts of money,” Harris stated. The current economic climate, marked by high interest rates and escalating material costs, has led to significant delays and a downturn in construction activities across the state.
According to the Association of Pennsylvania Realtors, the median home price held steady at $299,900 in September, a 3.4% increase from the previous year. This comes at a time when many potential homeowners are already struggling with affordability.
The Associated General Contractors of America reported that fewer than half of U.S. metro areas added construction jobs between August 2024 and August 2025. “Construction employment has stalled or retreated in more and more areas as owners pull back on projects due to higher costs,” said Ken Simonson, chief economist for the association.
Local builders are feeling the impact. Brian Miller, a designer at EXCEL Remodeling in Lemoyne, noted that the company’s typical 8 to 10-week project backlog has shrunk significantly. “We are doing OK. We’re not hurting, but we are definitely behind from what we were last year,” he remarked.
The construction slowdown is unprecedented. Harris recalled, “Even in 2008, when the housing bubble burst, that affected new construction dramatically, but as a remodeling contractor, we grew through that period. It has not been like anything I have ever experienced.”
Mike Klinepeter, president of Pyramid Construction in Wormleysburg, echoed these sentiments, stating, “It just feels like a very prolonged process on projects getting started.” He highlighted that difficulties in securing financing and navigating municipal building permits contribute to these delays.
The Pennsylvania Builders Association is actively collaborating with state officials to streamline the permit process, hoping to alleviate some of the burdens on builders. Meanwhile, inflation continues to weigh heavily on decision-making. Miller reports that customers are reluctant to invest in home improvements due to economic uncertainty.
The U.S. Commerce Department recently imposed tariffs that have driven up prices further, including a 10% tariff on timber and lumber imports and a 25% tariff on kitchen cabinets and furniture. Harris explained that prices have surged by 18% year-over-year since 2020.
With the benchmark 5-year $30,000 home equity loan now at approximately 8.13%, homeowners are dissuaded from applying for financing to support remodeling projects. The recent cut in interest rates by the U.S. Federal Reserve may offer some relief, but many builders remain cautious about the future.
Looking ahead, Klinepeter predicts that 2026 will begin similarly to 2025, but with added complexities from the ongoing federal government shutdown and Pennsylvania’s budget challenges. “Many of our projects are funded through government money, which could mean more delays if the shutdown continues,” he noted.
Harris remains hopeful, stating, “They say 2026 is going to be a good year in the remodeling world. Hopefully, the interest rates come down.” As builders navigate these turbulent waters, the future of Pennsylvania’s construction industry hangs in the balance, leaving many to wonder how long these delays will persist.
This urgent situation is developing, and the ripple effects are likely to be felt for months to come. Share this article to keep your community informed about the latest trends in the construction industry.
