The Sullivan Report’s Fall/Winter 2025 Economic Forecast reveals weaker demand, elevated inflation, and unresolved labor and federal funding challenges – potentially heightening risks and slowing construction recovery into late 2026.

The 2025 federal government shutdown ended after six weeks with a short-term funding deal - through Jan. 2026 - delaying key issues but causing modest GDP and construction funding impacts.

U.S. cement and construction markets face another year of contraction given inflation's impact on highway construction, a broken Highway Trust Fund, and IIJA replacements.

Following the last employment report and revisions, The Fed cutting rates in September was anticipated. Stronger-than-expected PPI data challenges expectations of a Fed rate cut in September, with core prices rising 3.7% annually.