It’s the economy, stupid
Traditionally, I keep a generally gentle outlook on things within this column. Being from Wisconsin, I feel there is no harm to at least acknowledge the current chill in the air. However, in this case, I believe there is more reason to pay that chill some heed.
Analysis of various indicators suggest that while 2026 will bring opportunities within the construction industry, there will also be significant headwinds from an economic perspective.
At the 2025 STAFDA Convention and Trade Show in Phoenix, economist Alex Chausovsky said the likeliest path forward for the economy is not up or down, but sideways.
He suggested that rather than uncertainty, 2026 could be defined by its complexity.
Rest assured that shiver going down your spine is not from the blast of frigid Wisconsin air I mentioned previously, but more the thoughts of a continuation of the labor shortages and concerns over material costs and tariff impacts being carried over from 2025.
Collectively, your customers, the construction contractors, told the Associated General Contractors of America and Sage in the 2026 Construction Hiring and Business Outlook Survey, that their expectations for 2026 have been dampened amid broader worries about the direction of the economy, aside from anticipated growth and surging demand for data centers and power facilities.
AGC’s survey showed 62% of respondents cited an economic slowdown or recession as their top concern going into 2026. In addition, 63% of participants reported that a project owner postponed or cancelled a project in the last six months.
To face these headwinds, things need to change and your business mindset must be broadened
In November, Chausovsky said, “You must develop a variety of strategies for different scenarios. It’s a different mindset that you’ve got to adapt to cope with the complexity that’s going on in the world around you.”
He suggested business owners develop multiple strategies for different possible economic situations, emphasizing that the way to growth will be to pivot toward growth sectors such as high-tech, AI and data center construction and looking for new customer acquisition in those areas.
Outside of those key strategies, the base message was to recognize what can be controlled in the current economic environment. Among his key points to STAFDA distributors was the importance of communication and maintaining a good line between distributor, supplier and customer.
Another strategy is to make a change in available services.
In my experience, repair services are common at many STAFDA distributors. However, it is also a service that is open to being scaled back in hopes of cutting costs and increasing revenue.
For our cover story, this month, starting on page 14, you can learn more about how Banner Tool Service of Glendale, Arizona, has found its niche by leaning into the repair aspect of the tool distribution world to become a trusted source for repair, fastener and tool supply and support through market changes.
Ryan Whisner
rwhisner@directbusinessmedia.com
This article originally appeared in the February/March 2026 issue of Contractor Supply magazine. Copyright, 2026 Direct Business Media.
CONTRACTOR SUPPLY MAGAZINE
The December 2025/January 2026 issue of Contractor Supply magazine is here!
Our cover story, Rising to the Challenge, Industrial Ladder & Supply in Villa Park, Ill. uses a classic service model to keep climbing the ladder of success.
Learn what happened at the 2025 STAFDA Convention and Trade Show, get a preview of World of Concrete 2026. Also in this issue are Industry Updates.
This digital edition, sponsored by BECK AMERICA Inc., is fully searchable and contains live links to every advertiser and new product listing. Click away!
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