CONEXPO 2026 Wraps as Tariffs Hammer Margins and Data Centers Break Records
CONEXPO-CON/AGG 2026 closes today in Las Vegas after five days with 2,000+ exhibitors, 130,000+ attendees, and nearly 3 million square feet of exhibit space. Meanwhile, the tariff squeeze is eating bids alive, Ohio’s E-Verify mandate goes live in 12 days, and data center construction just posted the highest monthly start figure ever recorded.
Here’s everything that matters for contractors this week.
CONEXPO 2026: The Announcements That Actually Matter for Your Business
Caterpillar made the biggest splash with AI tools, autonomous-ready equipment, and a new rental brand called “Cat Compact” aimed directly at small contractors. They showed 30+ machines including an all-new electric drive medium dozer, VisionLink fleet management, and their Cat Command autonomy portfolio.
Komatsu debuted two next-generation dozers (D61PXi-25 with IMC 3.0 intelligent machine control, D175AX-10), new excavators, wheel loaders, and their first-ever articulated truck.
Hitachi previewed its rebrand to LANDCROS (effective April 2027) and showed 20+ machines including the ZX500LCK-6 demolition config and ZX890-7 for mass excavation.
Electric equipment dominated the floor. LiuGong showed 13 machines including zero-emission excavators and wheel loaders claiming 40%+ lower operating costs. Revolution/London showcased an industry-first electrified mixer. More zero-emission options were on display than at any previous CONEXPO.
Topcon announced new 3D machine control, safety features, and geomatic surveying tech. Superior Industries unveiled 10 new products. The show also featured new EmpowerHER Workshops for women in construction and a Small Business Workshop track for entrepreneurs.
The takeaway for contractors under $10M: Cat Compact simplifies equipment purchasing for smaller firms. Electric equipment is no longer future talk. Machine control from Komatsu and Topcon can cut rework on every job.
Steel Up 12%, Aluminum Up 23%: The Tariff Crisis Is Here
The numbers are brutal. Steel tariffs at 50%. Aluminum at 50%. Copper products at 50%. Softwood lumber at 10% base plus 25% on derivatives.
Year-over-year impact on construction inputs as of January 2026:
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Steel bars/plates/structural shapes: up 12.1%
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Steel pipe and tube: up 9.4%
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Aluminum: up 23%
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Copper products: up 4.9%
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Overall construction inputs: up 2.3% YoY
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Nonresidential inputs: up 2.9% YoY
Construction input prices jumped 0.7% in January alone. ENR reports that Section 122 tariffs leave construction cost exposure largely intact. Brookings warns that tariffs threaten residential construction specifically.
The downstream effect: project abandonment surged 88.2% year-over-year. Contractors who bid jobs 60-90 days ago are now underwater on materials. Without escalation clauses in contracts, you’re eating the difference. Nearly 400 regulatory complaints against contractors were filed in one state alone since July 2025, with $5 million+ in claimed homeowner losses.
If you don’t have material escalation language in your contracts right now, stop reading and go fix that first.
Ohio E-Verify: March 19 Is 12 Days Away
Starting March 19, all nonresidential contractors in Ohio must use E-Verify. Penalties: up to $25,000 per violation. Multiple violations can get your business license permanently revoked.
This hits an industry where roughly 34% of construction trades workers are immigrants, rising to 61% in some specialties. The broader immigration enforcement crackdown is already creating what HR Dive calls “fear and chaos” in workforce planning.
Half of all states now require some form of E-Verify. Some Republican states are actually backing off under business pressure, but the overall trend is toward more enforcement. Contractors who haven’t enrolled face immediate compliance risk.
$25.2 Billion in Data Center Starts: January 2026 Broke the Record
January 2026 saw $25.2 billion in data center construction starts, the highest monthly figure ever recorded. Twenty projects broke ground including two developments worth $10 billion each.
Amazon, Alphabet, Microsoft, Meta, and Oracle have announced a combined $700 billion in capex for 2026, largely driven by AI infrastructure. Moody’s projects $3 trillion in global data center spending over the next five years. Over 56% of near-term spending is concentrated in the South. Power infrastructure alone has 86 GW planned for 2026.
For contractors not in this space: data centers are outbidding traditional commercial construction for both labor and materials. You’re competing against this boom whether you’re participating in it or not. For contractors who can position for it: this is the single largest construction opportunity in a generation.
The Two-Speed Economy: Boom and Bust in the Same Industry
While data centers and infrastructure spending break records, everything else is cooling:
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Nonresidential construction planning fell 6.3% month-to-month in January
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Housing starts down 7.3% year-over-year to 1,404,000 annualized
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Total construction spending at $2,168.8 billion (annual rate), but private construction down 2.9% from 2024
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Residential spending: down 2.6%
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Nonresidential private spending: down 3.1%
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Nonresidential building spending expected to grow only 1.7% this year
The Fed is holding at 3.5-3.75% with at most two cuts expected in 2026 and none in 2027. GDP growth projected at just 2.3%. Construction financing remains tight.
The market is splitting hard. Contractors on the data center/infrastructure/power side are crushing it. Everyone else is navigating declining demand, rising costs, and compressed margins simultaneously.
OSHA 2026: New Enforcement Priorities
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Heat Illness Prevention Standard moving forward: shade, rest, hydration, and acclimatization programs will be required
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Silica enforcement ramping up with more inspections and citations
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Electronic recordkeeping expanding: Forms 300/301 now submitted electronically, data going public, influencing which companies get targeted for inspections
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Expanded inspection capacity: more federal funding focused on falls, struck-by, trenching, electrical
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Walkaround rule: OSHA may allow third-party representatives to join workplace inspections
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California confined spaces: revised regulations already in effect since January 1
The electronic recordkeeping change is the sleeper. Your injury data is now going public and getting used to flag you for inspections. Clean records matter more than ever.
Physical AI Hits Jobsites in 2026
Gartner listed physical AI as a top 2026 technology trend, and construction is ground zero. Autonomous and semi-autonomous excavators, bulldozers, and loaders are now equipped with sensors, GPS, and AI for earthmoving, grading, and hauling. AI-powered site monitoring, layout marking, and material transport are entering real job sites.
The AI in construction market is projected to grow from $4.96 billion (2025) to $14.72 billion by 2030 at 24.3% CAGR. Construction software overall is projected to grow from $4 billion (2024) to $7 billion (2029). Subscription and SaaS pricing is lowering barriers for mid-size firms.
CONEXPO’s new “Smart Tech, Small Budget” programming was specifically designed for mid-size contractors looking to adopt technology without enterprise-scale budgets.
Modular Construction Gets a California Push
Governor Newsom is pushing major modular construction legislation for 2026. ReMo Homes received the first statewide pre-approval for modular homes in California. The residential modular construction market is projected to grow from $55.5 billion (2025) to $72.8 billion by 2030. Canada is also signaling prefab as the preferred approach for housing programs.
Competitor Content Check: What Other Construction Podcasts Published This Week
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Construction Leading Edge (Todd Dawalt): Ep 433, “5 Decisions That Free the Overworked Construction Owner.” Weekly cadence, strong focus on business systems.
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Contractor Success Forum: Active, covering cash flow management and business focus. CPA + surety bond agent duo gives a financial angle.
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ConTechCrew: Active through 2025. March 2026 episodes not indexed yet. Focus on AI and prefab.
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RE:Construction Podcast: Ep 197, payment reform discussion.
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Texas Association of Builders: Ep 131, residential construction contracts.
Content gaps wide open for Scaling Legends: Nobody is doing a proper CONEXPO wrap-up for small/mid-size contractors. Tariff impact on actual job pricing is underserved. E-Verify compliance walkthroughs barely exist in podcast format. Data center opportunity for small contractors is untouched.
The 3 Pain Points Dominating Every Conversation Right Now
1. The Cost Squeeze
Tariffs plus materials plus insurance. Steel up 12%, aluminum up 23%, insurance premiums climbing, bond requirements expanding. Contractors are trapped between fixed-price contracts from 60-90 days ago and costs that have moved since. Project abandonment up 88% is the downstream signal.
2. The Labor Crisis
349,000 workers needed. Half just to replace retirees. Immigration crackdown pulling 34% of the workforce into uncertainty. E-Verify mandates expanding. 45% of contractors reporting project delays from staffing. Wages rising 6-8% further compressing margins. The slight “relief” in the numbers is from cooling demand, not more workers.
3. Market Bifurcation
Data centers setting records ($25.2 billion in January alone). Power infrastructure exploding (86 GW planned). Meanwhile residential is down, commercial planning fell 6.3%, and traditional contractors are seeing pipelines thin. The contractors winning pivoted to infrastructure, data centers, or specialized niches. Everyone else is getting squeezed from both ends.
What Smart Business Automator Does in a Market Like This
When material costs change weekly and labor is scarce, operational efficiency is the only margin lever you control. Smart Business Automator handles estimating, scheduling, and crew management so you’re not burning hours on admin that should be automated. In a cost squeeze, the contractors who survive are the ones whose overhead is leanest.
Frequently Asked Questions
How are tariffs affecting construction costs in March 2026?
Steel tariffs at 50% have pushed steel bars and structural shapes up 12.1% year-over-year. Aluminum is up 23%. Copper products face 50% tariffs with 4.9% YoY increases. Overall construction inputs rose 2.3% YoY with a 0.7% jump in January alone. Project abandonment has surged 88.2% as contractors can’t absorb the increases on existing fixed-price contracts.
What were the biggest announcements at CONEXPO 2026?
Caterpillar launched “Cat Compact” for small contractors and showed AI/autonomous-ready equipment. Komatsu debuted next-gen dozers with IMC 3.0 machine control and their first articulated truck. Hitachi announced a rebrand to LANDCROS. Electric equipment dominated the floor with LiuGong showing 13 zero-emission machines claiming 40%+ lower operating costs. Over 130,000 attended.
How much data center construction started in January 2026?
$25.2 billion in data center construction starts in January 2026, the highest monthly figure ever. Twenty projects broke ground including two $10 billion developments. Tech companies have announced $700 billion in combined 2026 capex. Moody’s projects $3 trillion in global data center spending over five years. Over 56% of near-term spending is in the South.
What is Ohio’s E-Verify mandate for construction contractors?
Effective March 19, 2026, all nonresidential contractors in Ohio must use E-Verify. Penalties reach $25,000 per violation. Multiple violations can result in permanent business license revocation. This impacts an industry where 34% of trades workers are immigrants. Half of all states now require some form of E-Verify, though some Republican states are backing off under business pressure.
Sources: CONEXPO-CON/AGG, Construction Dive, ENR, ConstructConnect, Census Bureau, NAHB, Brookings, Electrek, Equipment World, WorkCare, PwC, K38 Consulting, HR Dive, S&P Global, GlobeNewsWire, Caterpillar, Komatsu