NSCA’s latest Electronic Systems Outlook report — the Winter 2024 edition, which includes information based upon actual data from January through November 2024, as well as forecasted information for 2025 and beyond — is free for NSCA members to download.

Following the pandemic, the report found that manufacturing construction experienced a significant peak due in part to government reshoring and Buy American initiatives. Although the construction momentum NSCA saw in manufacturing over the past few years is expected to decline through 2028, it’s important to note that this decline follows unprecedented highs from 2020 and 2021. The manufacturing sector remains strong despite the slowdown anticipated in 2025. Its continued strength should persist as it continues to be supported by government policies that bolster domestic production.

According to the report, recent return-to-office (RTO) policies are highlighting a growing demand for federal office spaces. Although reports indicate that some federal facilities were scarcely used in recent years, RTO is set to change that. In fact, the opposite may happen, where existing facilities struggle to accommodate the influx of workers who are coming back to the office full-time — or heading to the office for the first time after working remotely for years.

To address this challenge and accommodate those who live far from a federal office building, NSCA said satellite offices and smaller workspaces may be an option across the country. The industry may see additional construction growth as a result.

The warehouse market has reportedly seen substantial growth over the past few years; however, construction activity decreased last year, and 2025 construction trends point to another decrease this year before a projected leveling-off occurs in 2027, followed by a resurgence. (Even Amazon’s new starts for warehouses have reportedly declined — a reflection of this over-building.)

The report found the primary reason for this decline in warehouse construction is the over-building that occurred post-pandemic. When stay-at-home orders left people no choice but to rely on e-commerce, warehouse construction surged to help companies rapidly expand their capacities and capabilities. As e-commerce continues to grow, NSCA said the need for additional warehouse construction will eventually ramp back up, leading to renewed growth.

Brick-and-mortar retail has reportedly experienced growth over the past few years, but NSCA anticipates a decline in 2025. This decrease is due in part to the rise of e-commerce, which has surged past historical highs and taken consumers away from traditional retail spaces. Inflation also plays a role here as it exerts pressure on the retail market. While there are fewer physical retail locations today than a decade or two ago, the stores that remain must step up their technology game by offering immersive experiences and finding new ways to attract shoppers to compete with online shopping.

The United States has a growing elderly population that is driving the need for more healthcare. This means more construction to create clinics, assisted living and continuing care facilities, and hospitals. The report finds the Baby Boomer generation, which is rapidly aging, is driving this increased demand for healthcare facilities.

The report finds that construction in healthcare may also include specialized facilities that cater to this market and support the physical and mental well-being of older adults. It will also include integration of advanced health technologies, such as telehealth and wearable devices.