Hawaiʻi’s construction industry opened 2026 with its foot firmly on the gas. Total construction spending in the first quarter climbed to $2.09 billion, even as private housing work eased compared with a year earlier. The surge came largely from public sector projects, according to data released this month.
Data from the Pacific Resource Partnership shows first quarter spending rising to $2.09 billion from $1.84 billion in the same period of the previous year. More than half of that total came from state funded and other public projects, a breakdown detailed by Pacific Business News.
Public projects push totals higher
State and federal projects, from capital improvements to large military contracts, helped prop up overall activity and counter the slowdown on the private side. The Department of Business, Economic Development & Tourism has pointed to rising government contracts and continues to describe construction as a near term driver for growth. DBEDT recorded a 24.7% increase in government contracts in late 2025, and Hawaii Business has tracked how defense and infrastructure spending are shaping the construction pipeline for 2026.
Housing dip signals cooling private investment
The quarter by quarter breakdown from Pacific Resource Partnership shows housing project value slipping compared with the same stretch in 2025, with multi family starts softening in particular. Builders and developers point to a familiar trio of headaches: rising material costs, slow permitting, and tighter financing that together are cutting into private starts even as public money continues to back big ticket work.
What this means for workers and builders
Construction employment is still on the upswing. DBEDT data show construction jobs increasing by about 2,700, roughly 6.9%, in late 2025, keeping demand for labor strong even as the mix of projects shifts. For local subcontractors and housing builders, that translates into steady work tied to public contracts but potentially slimmer margins and scheduling complications on private projects.
Analysts say the next quarterly update from Pacific Resource Partnership and upcoming permit data from DBEDT will help show whether private housing stages a rebound or public works continue to carry 2026. For now, the figures point to a market leaning more heavily on public dollars as housing investment cools.
