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
Giants 400 | Sep 28, 2017
Top 85 government construction firms
Turner Construction Co., PCL Construction Enterprises, and Clark Group top BD+C’s ranking of the nation’s largest government sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
Multifamily Housing | Sep 27, 2017
Pickleball, anyone?
Two-and-a-half million Americans are playing the game with the funny name.
Giants 400 | Sep 22, 2017
Top 80 hotel construction firms
Turner Construction Co., Swinerton, and The Whiting-Turner Contracting Co. top BD+C’s ranking of the nation’s largest hotel sector contractor and construction management firms, as reported in the 2017 Giants 300 Report.
40 Under 40 | Sep 22, 2017
Meet the 40 Under 40 Class of 2017
These AEC stars are making their mark in business, philanthropy, and in their communities.
40 Under 40 | Sep 21, 2017
Meet the 40 Under 40 Class of 2017
These AEC stars are making their mark in business, philanthropy, and in their communities.
Multifamily Housing | Sep 19, 2017
Top 90 multifamily construction firms
Lendlease, Suffolk Construction, and Clark Group top BD+C’s ranking of the nation’s largest multifamily sector contractor and construction management firms, as reported in the 2017 Giants 300 Report.
Contractors | Sep 19, 2017
Commercial Construction Index finds high optimism in U.S. commercial construction industry
Hurricane recovery efforts expected to heighten concerns about labor scarcities in the south, where two-thirds of contractors already face worker shortages.
Giants 400 | Sep 13, 2017
Top 75 retail construction firms
The Whiting-Turner Contracting Co., PCL Construction Enterprises, and Shawmut Design and Construction top BD+C’s ranking of the nation’s largest retail sector contractor and construction management firms, as reported in the 2017 Giants 300 Report.
Contractors | Sep 6, 2017
Following the money: G702 progress payment certifications
There is no single method of calculating progress payments, but the most common formula is the percentage of completion applied to the total contract price, less a retainage which is held by the owner until final acceptance of the project.
Multifamily Housing | Sep 5, 2017
Free WiFi, meeting rooms most popular business services amenities in multifamily developments
Complimentary, building-wide WiFi is more or less a given for marketing purposes in the multifamily arena.