National nonresidential construction spending increased 0.8% in July, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $847.6 billion for the month.
Spending was up on a monthly basis in 13 of the 16 nonresidential subcategories. Private nonresidential spending was up 0.4%, while public nonresidential construction spending was up 1.5% in July.
“The nonresidential sector continues to grapple with rising borrowing costs, elevated materials and labor costs and pervasive economic pessimism,” said ABC Chief Economist Anirban Basu. “Despite a modest increase in July, nonresidential construction spending remains below its pre-pandemic level. There is, however, at least one bright spot for the industry: publicly financed construction. State and local governments are flush with cash, and considerable funding is slated for various forms of infrastructure. In July, spending in the highway and street category increased 4.4%, while spending in the public safety category rose 2.3%.
“For privately financed construction, circumstances could get worse before they get better,” said Basu. “The Federal Reserve recently recommitted to further tightening monetary policy. Market sentiment quickly turned negative. Rather than disappear, supply chain challenges are proliferating in much of the world, including in Europe and China, and the risk of recession is elevated. This is simply not a set of circumstances conducive to rapid nonresidential construction spending growth, and according to the most recent Construction Confidence Index, just 31% of contractors expect their profit margins to grow over the next six months.”
Related Stories
Hotel Facilities | Jun 18, 2021
Adaptive reuse for hospitality, with Frank Cretella of Landmark Developers
In an exclusive interview for HorizonTV, Landmark Developers' President Frank Cretella talks about the firm's adaptive reuse projects for the hospitality sector. Cretella outlines his company's keys to success in hospitality development, including finding unique properties and creating memorable spaces.
Wood | Jun 10, 2021
Three AEC firms launch a mass timber product for quicker school construction
TimberQuest brand seeks to avoid overinvestment in production that has plagued other CLT providers.
Office Buildings | Jun 10, 2021
The future of the workplace is social clubs
Office design experts from NELSON Worldwide propose a new concept for the workplace, one that resembles the social clubs of the past.
Multifamily Housing | Jun 3, 2021
Student Housing Trends 2021-2022
In this exclusive video interview for HorizonTV, Fred Pierce, CEO of Pierce Education Properties, developer and manager of off-campus student residences, chats with Rob Cassidy, Editor, MULTIFAMILY Design + Construction about student housing during the pandemic and what to expect for on-campus and off-campus housing in Fall 2021 and into 2022.
Contractors | Jun 1, 2021
Swinerton wants a bite of the Big Apple
The California-based construction firm opens an office in New York City that is positioned to become its Northeast hub.
Building Technology | Jun 1, 2021
Orro Announces Google Nest Integration for the Orro Switch
Orro, creators of the professional-grade top-of-the-line Orro Smart Living System, today announced the integration of Nest products to Orro. As a certified partner in Google’s Device Access program, this latest Orro integration allows homeowners to have seamless control and access to Nest thermostats and doorbells from any Orro Switch throughout the home – creating a single unified smart home system with advanced, intelligent ambient control.
Contractors | Jun 1, 2021
Swinerton to open its first New York City office
Andrew Pearl will head up the New York City Office.
High-rise Construction | May 27, 2021
The anti-high rise: Seattle's The Net by NBBJ
In this exclusive video interview for HorizonTV, Ryan Mullenix, Design Partner with NBBJ, talks with BD+C's John Caulfield about a new building in Seattle called The Net that promotes wellness and connectivity.
Contractors | May 25, 2021
Doug Woods, DPR Construction's cofounder, dead at 70
His management style stressed collaboration that can tackle complex projects.
Digital Twin | May 24, 2021
Digital twin’s value propositions for the built environment, explained
Ernst & Young’s white paper makes its cases for the technology’s myriad benefits.