GroupNAICS 2362Construction

Nonresidential Building Construction (U.S.) — NAICS 2362

An investor's rollup primer for a general audience — relevant to both public-market and private investors. This is a NAICS industry group (the 4-digit level) that sits one rung above two distinct businesses: building factories and building everything-else-nonresidential (offices, hospitals, schools, warehouses, and the data centers now driving the whole sector). The value of this page is the contrast between those two children — how differently they are sized, growing, owned, and invested in. Figures are reported federal facts with citations; statements about the future are labeled as judgments.

1. Overview

NAICS (the North American Industry Classification System, the standard the U.S. government uses to group businesses by what they do) puts almost all "build a non-home building" activity into one 4-digit box: industry group 2362, Nonresidential Building Construction [1]. The firms here are general contractors (GCs — a GC takes responsibility for delivering a finished building), design-build firms (one firm handles both design and construction), and construction managers. They rarely own the building; they organize design, labor, materials, equipment, and a chain of specialty subcontractors to hand a corporate, institutional, or government owner a finished structure, mostly for use rather than resale. There is essentially no consumer component — this is a business-to-business and business-to-government activity [1].

The group splits cleanly into two very different jobs:

Building things that make things — factories, assembly plants, semiconductor "fabs" (fabrication plants), refineries, chemical and steel plants (NAICS industry 23621).
Building things that house activity — offices, hospitals, schools, hotels, warehouses, stores, arenas, courthouses, airport terminals, and increasingly data centers for artificial-intelligence (AI) computing (NAICS industry 23622).

It matters right now because this single group contains the two biggest construction stories of the decade — the reshoring / factory boom (23621) and the AI data-center boom (inside 23622) — running on different clocks. Understanding 2362 means understanding that split.

2. What's inside — the two children and how they differ

The hierarchy narrows step by step: sector 23 (Construction) → subsector 236 (Construction of Buildings) → industry group 2362 (this page) → two 5-digit industries below. Each of those two, in turn, has a single 6-digit child, so 23621 ≡ 236210 and 23622 ≡ 236220 — the meaningful fork in the road is here, at 2362, between industrial and commercial/institutional.

The contrast is the whole story. These are not two flavors of the same thing; they differ in size, momentum, and how an investor touches them.

	23621 — Industrial	23622 — Commercial & Institutional
What it builds	Factories, fabs, plants, mills, refineries	Offices, hospitals, schools, hotels, warehouses, stores, data centers
Share of the group's receipts	~6% (~$36.2B) [4]	~94% (~$585.6B) [6]
Share of establishments	~8% (3,380) [5]	~92% (39,072) [7]
Share of employment	~10.5% (75,224) [5]	~89.5% (640,858) [7]
Receipts per employee	~$481,000 [4][5]	~$914,000 [6][7]
Concentration (HHI / CR4)	HHI 90.6, CR4 13.1% — fragmented but with a distinct mega-project tier [4]	HHI 23.1, CR4 6.8% — extraordinarily fragmented [6]
Direction of travel	Reshoring/CHIPS boom has peaked; new spend cooling from a record, backlogs still full [8]	Two-speed: data centers/AI surging, offices-retail-hotels flat [10][11]
Who owns the builders	Mostly private (Bechtel, Turner, Kiewit, DPR, Mortenson) + global EPC firms	Mostly private, family/employee-owned (Turner, Whiting-Turner, DPR, McCarthy, Clark), some foreign-parented [12][13]
How to invest (public)	No pure-play; via specialty mechanical/electrical, sitework/civil, diversified EPC	No pure-play; via specialty-trade contractors and diversified/foreign-listed builders

Read the size row carefully. Commercial & institutional is ~16× the size of industrial by receipts, so 2362's rollup figures are ~94% a story about 23622 — the group total moves with offices, hospitals, warehouses, and data centers, not with factories. But the two shares are misleading in opposite directions:

Industrial's 6% understates its importance. The giant engineering-procurement-construction (EPC) firms that lead the largest fabs and plants are often classified under engineering services (NAICS 541330), not here, and most factory dollars flow to specialty and heavy-civil subcontractors in other codes. Industrial's low receipts-per-worker (~$481k vs. ~$914k) partly reflects that the biggest industrial project value is booked outside this code (see §3) [4][8].
The two builders overlap. Bechtel, Turner, Kiewit, DPR, and Mortenson appear on both children's rosters — the same national contractors and the same skilled-labor pool serve factories and data centers alike. The NAICS wall between 23621 and 23622 is a statistical convenience, not a wall between two separate industries of firms.

3. Size (this level's rollup figures)

These are our ground-truth federal statistics for NAICS 2362. Note the periods differ: receipts, firm count, and concentration come from the 2022 Economic Census (EC); employment, payroll, and establishments come from 2023 County Business Patterns (CBP) — so they are not directly comparable, and they are the sum of the two children.

Metric	Value	Source (year)
Receipts (revenue)	~$621.8 billion	Economic Census (2022) [2]
Firms	42,367	Economic Census (2022) [2]
Establishments (with employees)	42,452	County Business Patterns (2023) [3]
Paid employees	716,082	County Business Patterns (2023) [3]
Annual payroll	~$69.3 billion	County Business Patterns (2023) [3]
First-quarter payroll	~$16.7 billion	County Business Patterns (2023) [3]
Avg. pay per employee	~$97,000 (payroll ÷ employees)	derived from [3]

Average pay near $97,000 sits well above the U.S. private-sector average, reflecting skilled trades, engineers, and project managers [3]. With ~42,400 firms running ~42,500 establishments, the group is overwhelmingly single-location firms, and the typical establishment is small (about 17 workers) — a handful of national giants over a very long tail [2][3].

Concentration — even more fragmented than either child. Across the whole group, the top 4 firms held just 6.4% of receipts (the CR4, or four-firm concentration ratio), the top 8 held 10.1% (CR8), the top 20 16.9% (CR20), and the top 50 24.7% (CR50), for a Herfindahl-Hirschman Index (HHI, a standard concentration gauge running from near 0 to 10,000 for a monopoly; below 1,500 is "unconcentrated") of just 21.3 [2]. A useful technical note: the rollup HHI (21.3) is lower than either child's (90.6 industrial, 23.1 commercial) — combining two already-fragmented industries whose leaders differ dilutes measured concentration further. Thousands of contractors compete and no one is close to dominant.

Undercount and read-with-care caveats.

Very small operators are undercounted. CBP covers only employer establishments with paid employees; it excludes the self-employed and nonemployer firms [17]. One-person design-build shops and independent construction managers are therefore understated — though small/individual ownership matters less in nonresidential work than in home building, so this effect is milder here than in the residential codes.
Receipts overstate value added. Under the general-contractor model, most project dollars pass straight through to subcontractors and suppliers; payroll is only about 11% of receipts [2][3], so the builders' own value-add is a thin layer on a large flow.
The $621.8B is not the size of the market for these buildings. It counts only the revenue of firms primarily classified as nonresidential building GCs. The far larger installed value of the buildings — including specialty trades, heavy-civil work, EPC firms, and equipment — lives in other codes. For scale on the industrial side alone, the Census "value of construction put in place" for manufacturing facilities ran near a $240 billion annual rate at its 2024 peak and stayed above $190 billion into 2026 [8] — several times 23621's own $36B of receipts. Treat 2362's receipts as the GCs' slice, not the total spend.
No official margin or backlog exists. Federal data publish no NAICS-2362 operating margin, order backlog, or win rate; do not infer any from a single contractor's results.

4. Investable universe — where value concentrates across the children

The blunt truth spans both children: there is no large, pure-play, publicly traded U.S. nonresidential-building general contractor. The biggest builders are private, and public exposure is indirect. Value and defensible margin concentrate away from plain general contracting, toward the same set of vehicles for both factories and commercial buildings:

Specialty mechanical / electrical contractors — the cleanest listed way in, with the most direct fab-and-data-center leverage and higher, steadier margins than GCs (tickers in §10).
Sitework / civil names that prepare the pads for both plants and data centers.
Diversified EPC / engineering firms that blend U.S. building work with energy, transport, industrial, and government projects.
The private building giants themselves — Turner, Bechtel, Whiting-Turner, DPR, Kiewit, Mortenson, Clark, McCarthy — mostly family-owned, employee-owned (via employee stock ownership plans, or ESOPs), or foreign-parented, and reachable only through private equity, private credit, and project finance [12][13][14].

How the two children route capital differently: industrial's most concentrated exposure is even more private (the mega-fab builders are almost all private/EPC), while commercial/institutional offers slightly more public breadth through diversified and foreign-listed contractors. In both, tickers are exposure vehicles, not exact-code comparables.

5. How the money works

A nonresidential builder is financially a risk-managed pass-through: it collects a large contract value, pays most of it out to subcontractors and suppliers, and keeps a thin margin for coordinating the work and absorbing risk. The mechanics are the same across both children:

Revenue is recognized over time (percentage-of-completion), so accurate cost estimating drives reported earnings and a single mis-bid surfaces as a margin write-down.
Backlog — signed, not-yet-built work — is the single most-watched forward gauge, tracked for both size (months of work) and embedded gross margin. It converts to revenue over roughly one to four years but is not guaranteed: it can be delayed, resized, canceled, or rendered unprofitable.
Contract structure sets who bears risk, from fixed-price / lump-sum (builder eats overruns) through guaranteed-maximum-price (GMP), design-build, and construction-management-at-risk, to cost-plus (owner bears more).
Margins are thin and risk-priced — non-official benchmarks put GC net margins near 5–6% [16] — and because contractors lay out cash for labor and materials ahead of payment, working capital and cash timing (retainage, slow payment) can sink a paper-profitable builder on liquidity.

A cross-child nuance: specialty mechanical/electrical trades have generally earned higher, steadier margins than general contractors and design houses in both the industrial and commercial arenas — which is exactly why the investable value clusters there (§4).

6. Demand drivers

Demand is derived — it follows customers' decisions to add capacity or space, which makes the whole group deeply cyclical and interest-rate sensitive. The forces differ by child, and that divergence is the defining feature of 2362 right now:

AI and data centers (inside 23622) — the dominant swing factor now carrying the group's top line; data-center construction spending jumped ~32% in 2025 [10][11].
Semiconductors and the CHIPS Act (mostly 23621) — the 2022 CHIPS and Science Act (Creating Helpful Incentives to Produce Semiconductors) put ~$39 billion of direct incentives behind dozens of new U.S. fabs; note data centers are counted as commercial (23622), but the same contractors serve both [8].
Reshoring and industrial policy (23621) — tariffs, the Inflation Reduction Act (IRA) clean-energy credits, and supply-chain security drove the factory build-out [8].
Interest rates and financing — nonresidential buildings are debt-financed and capital-intensive, so higher rates delay projects on both sides [10].
Institutional and public budgets — hospitals, schools, universities, and government buildings follow demographics and appropriations [11].
Corporate capital spending for offices, warehouses, and retail — structurally softer post-pandemic — plus renovation, compliance, and tourism/events work [11][12].

Judgment: the two booms are on opposite clocks. The subsidy-and-reshoring factory surge (23621) appears to have peaked, with manufacturing-construction spending cooling from its record [8]; the AI data-center surge (inside 23622) is still climbing and now masks weakness elsewhere in commercial [10][11].

7. Regulation

There is no single industry regulator; construction is regulated at the point of work, and the same stack applies across both children:

State/local licensing, building codes, permits, and zoning — the U.S. has no single national building code [15].
Federal worker safety under the Occupational Safety and Health Administration (OSHA), 29 CFR Part 1926.
Environmental permitting under the Environmental Protection Agency (EPA) and the National Environmental Policy Act (NEPA), which can add months or years to a mega-project (a bigger factor on large industrial plants).
Prevailing-wage rules (Davis-Bacon and Related Acts) on public work — and attached to much CHIPS and IRA money, directly raising labor cost on subsidized fabs — plus domestic-materials requirements (Buy America / Buy American).
Surety bonding, which effectively caps how much work a contractor can take and is a real barrier to scaling.

8. Consolidation

Fragmentation is the defining trait of the whole group — ~42,000 firms with the top 4 under 7% of receipts [2].
General contracting has resisted roll-ups (low barriers, people-and-process businesses, local reputation), so most merger action sits in the specialty trades (mechanical, electrical, HVAC, roofing, fire protection), where recurring service revenue and higher margins support consolidation [14].
The two children consolidate differently. In industrial (23621), consolidation is accelerating, driven by labor scarcity and private-equity (PE) roll-ups — buying a firm is often the fastest way to acquire experienced crews. In commercial/institutional (23622), ESOPs are the dominant succession-and-retention tool (the number of ESOP construction firms roughly grew from ~700 to over 1,100 in a decade), and foreign ownership at the top (e.g., Turner via Germany's HOCHTIEF/ACS) sends some profits to overseas shareholders [12][13][14].
One caution flag: some observers warn PE roll-ups of affiliated contractors can raise project risk when cost discipline overrides execution quality.

9. Risks

The risk set is shared, but the exposures tilt by child:

Cyclicality and interest-rate sensitivity — the whole group turns with capital-spending and financing conditions [10].
Theme concentration — recent growth leans heavily on two narrow themes: reshoring/fabs (23621) and data centers/AI (inside 23622). If either cools, much of the growth reverses [8][10][11].
Fixed-price execution risk — cost overruns on lump-sum mega-projects (large fabs especially) can wipe out a project's profit [16].
Skilled-labor shortage — the binding constraint on capacity; the industry must attract on the order of 349,000 additional workers in 2026 [9].
Policy reversal — subsidies, tariffs, immigration, and prevailing-wage rules are politically contingent, and bear directly on the industrial side.
Input-cost and tariff volatility, claims and change orders, working-capital/payment risk, and safety and environmental liability round out the set — with the reminder that a large reported backlog can conceal low margins, unfunded work, or cancellation risk.

10. How to invest and outlook

How to invest. Because pure-play nonresidential-building GCs are almost all private, public investors reach 2362 indirectly and should weigh backlog quality and margin trajectory over headline revenue:

Specialty mechanical/electrical contractors — richest margins, most direct fab-and-data-center leverage: EMCOR (ticker EME), Comfort Systems USA (FIX), IES Holdings (IESC).
Sitework / civil: Sterling Infrastructure (STRL), Granite Construction (GVA).
Diversified EPC / engineering: Fluor (FLR), Jacobs (J), AECOM (ACM) — scale blended with energy, transport, and government work.

Private investors reach the most concentrated exposure — the private building giants and the biggest fabs — through PE construction roll-ups, private credit / project finance on individual plants and data centers, ESOP participation, and real-assets strategies tied to industrial and digital-infrastructure development.

Outlook (forward-looking judgment). The base case entering 2026 is a genuinely two-speed group. Data centers, AI infrastructure, healthcare, education, and renovation are strong; offices, retail, hotels, and winding-down manufacturing mega-projects are weak. The American Institute of Architects' (AIA) July 2026 consensus forecast expects total nonresidential building spending to fall 0.3% in 2026 and rise 3.0% in 2027, with the commercial line carried almost entirely by data centers [12]. Meanwhile the record backlogs built during the 2022–24 reshoring boom should keep the largest industrial contractors busy well into the second half of the decade even as new factory spending cools from its peak [8]. The durable lesson is structural: 2362 is a fragmented, thin-margin, execution-driven group where money is made through backlog discipline, risk control, and cash conversion — and, on the public side, through the specialty trades and diversified contractors rather than the private building giants themselves.

For full company-level detail, contract economics, and diligence checklists, see the child primers: [23621] (industrial) and [23622] (commercial & institutional).

Sources

Drawn from the two child primers (23621 and 23622); figures for this level are the group rollup.

U.S. Census Bureau, 2022 NAICS Definitions — 2362 Nonresidential Building Construction (scope and exclusions), 2022. https://www.census.gov/naics/?details=2362&year=2022
U.S. Census Bureau, 2022 Economic Census — Concentration of Largest Firms, NAICS 2362 (receipts, firm count, CR4/CR8/CR20/CR50, HHI). https://data.census.gov/table/ECNSIZE2022.EC2200SIZECONCEN
U.S. Census Bureau, County Business Patterns 2023, NAICS 2362 (establishments, employment, payroll). https://data.census.gov/table/CBP2023.CB2300CBP
U.S. Census Bureau, 2022 Economic Census — Concentration, NAICS 236210 (Industrial Building Construction) (receipts, CR4/HHI). https://data.census.gov/table/ECNSIZE2022.EC2200SIZECONCEN
U.S. Census Bureau, County Business Patterns 2023, NAICS 236210 (establishments, employment, payroll). https://data.census.gov/table/CBP2023.CB2300CBP
U.S. Census Bureau, 2022 Economic Census — Concentration, NAICS 236220 (Commercial and Institutional Building Construction) (receipts, CR4/HHI). https://data.census.gov/table/ECNSIZE2022
U.S. Census Bureau, County Business Patterns 2023, NAICS 236220 (establishments, employment, payroll). https://data.census.gov/table/CBP2023.CB2300CBP
Federal Reserve Bank of St. Louis (FRED), Total Construction Spending: Manufacturing in the United States (TLMFGCONS), 2026. https://fred.stlouisfed.org/series/TLMFGCONS
Associated Builders and Contractors, Construction Industry Must Attract 349,000 Workers in 2026, 2026. https://www.abc.org/News-Media/News-Releases/abc-construction-industry-must-attract-349000-workers-in-2026-despite-macroeconomic-headwinds
Associated Builders and Contractors / Construction Owners, Construction Outlook 2026: Data Center Boom Masks Broader Industry Slowdown, 2026. https://www.constructionowners.com/news/construction-outlook-darkens-as-data-center-boom-masks-broader-industry-slowdown
Wolf Street, Construction Spending on Data Centers, Factories, Powerplants, and Office Buildings, 2026. https://wolfstreet.com/2026/02/28/construction-spending-on-data-centers-factories-powerplants-and-office-buildings-boom-bust-and-in-between/
American Institute of Architects, July 2026 Consensus Construction Forecast, 2026. https://www.aia.org/resource-center/july-2026-consensus-construction-forecast
Engineering News-Record (ENR), 2026 Top 400 Contractors, 2026. https://www.enr.com/toplists/2026-Top-400-Contractors-2
BDO / NCEO (National Center for Employee Ownership), Employee Stock Ownership Plans Gain Traction in the Construction Industry (fragmentation, ESOP prevalence, specialty-trade M&A), 2025. https://www.bdo.com/insights/tax/employee-stock-ownership-plans-gain-traction-in-the-construction-industry
U.S. Department of Energy, Energy Codes 101 (no single national building code), 2016. https://www.energy.gov/cmei/buildings/articles/energy-codes-101-what-does-role
Siana Marketing / Bridgit, General Contractor Profit Margin: 2026 Industry Data & Benchmarks (non-official benchmarks: gross ~12–16%, net ~5–6%), 2026. https://www.sianamarketing.com/resources/general-contractor-profit-margin
U.S. Census Bureau, County Business Patterns — Methodology (coverage of employer establishments only), 2026. https://www.census.gov/programs-surveys/cbp/technical-documentation/methodology.html

For the full source lists (companies, contract economics, demand drivers, regulation, and consolidation), see the child primers, NAICS 23621 and 23622.