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Philadelphia Construction Jobs Could Dwindle In 2025 As Big Projects Pause

Jobs for Philly construction workers could take a nosedive next year as a glut of residential projects wrap up and others get put on the shelf.

Developers say construction starts are set for a hard crash after a rush to take advantage of the city's former 10-year tax abatement program temporarily sent activity into the stratosphere. That means an industry that has historically been desperate for workers could find itself in the unfamiliar position of having to scale back employment.


Foundation-pouring, steel-setting, bricklaying, painting, carpentry and other work is apparent everywhere along the most popular corridors of the city, as crews work through a huge backlog of projects permitted in the months before the popular tax abatement program expired in January 2022. More than 26,000 units were permitted in 2021, five times more than in 2020.

But much of that work will wrap up within 18 months, developers told Bisnow.

“It's not even anticipating a downturn. The downturn's already here,” said Vince Jolly, founder and president of CVA Commercial Group.

Low interest rates and determination to beat the tax break deadline helped fuel a construction explosion that began in 2022. More than 10,000 units came up for lease or sale last year, and an additional 16,000 mostly high-end and luxury units are scheduled to be completed over the next year and a half.

But in January, permits for only 949 housing units were issued in the entire Philadelphia-Camden-Wilmington region, and February wasn't much better at 986, according to census data

“I think construction workers, obviously, are going to get hit hard,” Jolly said. “Because once these jobs dry up, I mean, what else are they going to do?"

Construction jobs have grown rapidly in the city, rising about 1.5% from 2021 to 2023, census figures show. As of late last year, 121,000 Philadelphia-area workers were employed in the construction trade.

But the city's top trigger, new apartment starts under construction, have shrunk by more than 30% compared to the peak in late 2022, according to CoStar data. Meanwhile, 99 projects totaling 17,000 units have been stopped in the proposal stage since then.

A building boom set to go bust will solve one issue — overbuilding that has led to too much supply and downward pressure on rents — and create another for the construction industry, The Riverwards Group Managing Partner Mo Rushdy said at Bisnow's Construction and Development Summit last month.

“That glut of apartments will solve itself, let's say, by May 2025,” Rushdy said. “The real problem is, No. 1, jobs. We hear from our friend in the trade unions and from others that projects are going to dry up in terms of the residential industry and when it comes to new jobs coming from the pipeline of ’26 and ’27.”

Rushdy said jobs tomorrow depend on developers snagging permanent financing today.

“I'll tell you from experience, we're not even seeking financing,” Rushdy said.


Calvin Snowden, founder and managing partner of Philadelphia-based construction management firm BDFS Group, said he is already seeing signs of trouble at competing businesses as new starts fall off a cliff and tough labor decisions need to be made.

“I see the bigger players are starting to be impacted. Companies that were very profitable for the past couple of years are barely making it,” Snowden said. “I’m an engineer, not an economist, [but] I know there’s a problem. I know the interest rates have to come down since the projects don’t make sense anymore. The numbers just don’t work.”

Snowden said diversifying offerings is key to making it through a slower period. BDFS Group does in-house carpentry and masonry work as well as general construction. And when the pandemic downturn hit the primarily residential-based construction company, Snowden pivoted his 22-person team to commercial projects in other asset types.

BDFS has seen projects boosted by the commonwealth’s Redevelopment Assistance Capital Program, which matches loan funding on projects that are at least $1M in scope. Snowden said life sciences, university and public-private projects are still robust for his peers.

He also predicted others' pain will be his gain.

“Where other companies are laying off, I’m hiring,” he said.

“It’s interesting. We had a couple of years with not enough people in the trades. We had too many jobs and not enough people. It might end up rightsizing itself now and we can get a core group of people in the trades.”

Although nearly 100 multifamily projects have been put on hold, including Alterra Property Group's 352-unit building in University City, a few large projects are plowing on.

Dominating the landscape is Tower Investments' 1,111-unit project underway in Center City. The build accounts for 6.5% of all units under construction across the metro, according to CoStar. It is also the 11th-largest ongoing apartment project in the nation.

But large projects are few and far between these days. Mark Cartella, senior vice president of development and construction at Alterra Group, said smaller projects are key to keeping the industry moving.

“I think you're going to see a pullback on [large-scale projects] before you see a pullback in some of the smaller-scale construction,” he said.

Redevelopments are keeping things moving for Benchmark Construction Group, principal Kenn Penn said. The group is working on a multifamily development in Fishtown and searching for corners of the city where demand remains.

“We’re doing some work in South Philadelphia, North Philadelphia and certain pockets where there’s still opportunity,” Penn said.

“We’re able to put that thread through the needle in those areas doing ground-up or existing housing.”