Nonresidential construction spending fell 0.4% on a monthly basis in March, according to analysis of U.S. Census Bureau data released today by Associated Builders and Contractors (ABC), but it was up 8.3% on a year-over-year basis to $695.7 billion. Eight of 16 nonresidential construction subsectors experienced monthly spending growth in March and twelve are up on a year-ago basis.
March would have recorded a monthly spending gain were it not for an upward revision to February's data (from $690.3 to $698.4 billion).
"Viewed optimistically, one can conclude that nonresidential construction has stabilized at a high level," said ABC Chief Economist Anirban Basu. "While the last several months have failed to deliver significant spending growth, many contractors indicate that they remain busy and that backlog levels are satisfactory. Still, one might have expected better spending growth performance given the combination of steady job growth nationally, large sums of capital coming from abroad and invested in the U.S. and surprisingly low interest rates.
"Based on recent trends, one concludes that many U.S. corporations remain reluctant to invest in large-scale projects," said Basu. "Nonresidential fixed investment has generally been soft over recent quarters, and has subtracted from GDP growth recently. America has been experiencing a corporate profits recession recently and slow growth. GDP expanded less than 2% on an annualized basis during last year's final quarter and less than 1% during this year's first. Combine that with hesitant government agencies, and one lacks a recipe for healthy nonresidential construction spending growth."
Spending has increased in 12 of the 16 construction subsectors over the past year. Three of the four sectors registering spending declines over that time — water supply, conservation and development, and public safety — rank among the four smallest subsectors. Each of these subsectors is also heavily influenced by public sector capital budgets.
Eight of 16 nonresidential construction sectors experienced spending increases in March on a monthly basis:
- Lodging-related spending was up 1% from February 2016 and is up 27.7% from March 2015;
- Health care-related spending expanded 1.6% month-over-month and is up 4.1% year-over-year;
- Commercial-related construction spending rose 1.2% for the month and 14.5% over the last year;
- Conservation and development-related spending was 1.6% higher on a monthly basis, but is 3.3% lower on a year-over-year basis.
- Spending in the religious category grew 5.2% for the month and is up 6.4% from March 2015.
- Manufacturing-related spending gained 2% on a monthly basis, but is down 2.1% on a year-over-year basis.
- Communication-related spending grew 3.7% month-over-month and has expanded 10.4% year-over-year.
- Spending in the highway and street category expanded 0.5% from February and is 18.8 higher than one year ago.
Spending in eight of the nonresidential construction subsectors fell in March on a monthly basis:
- Spending in the amusement and recreation category fell 1% from February, but is up 9.6% from the same month one year ago.
- Education-related construction spending fell 0.6% on a monthly basis, but has expanded 11.8% on a yearly basis.
- Sewage and waste disposal-related spending fell 4.2% for the month, but is up 3.8% from the same time one year ago.
- Spending in the power category was down 3.2% from February, but is up 0.8% from a year ago.
- Water supply-related spending fell 1.6% on a monthly basis and has declined 6.1% on a yearly basis.
- Spending in the office category declined 1.3% from February, but is up 19.5% on a year-ago basis.
- Transportation-related spending fell 2.1% month-over-month and has expanded 1.2% year-over-year.
- Public safety-related spending is down 7.8% for the month and 12.3% from March 2015.
Related Stories
| Aug 11, 2010
Populous selected to design 'crystalline skin' stadium for 2014 Winter Olympics
Russian officials have selected global architect Populous to design the main stadium for the 2014 Winter Olympic and Paralympic Games in Sochi, Russia. The 40,000-seat stadium will feature a crystalline skin that "engages with its surroundings by day and provides an iconic representation of the color and spectacle of the games when illuminated at night," said Populous senior principal John Barrow.
| Aug 11, 2010
Three Opus Corporation companies file for bankruptcy
Opus Corporation, a developer headquartered in Minnetonka, Minn., filed for bankruptcy in three of its five regional operating companies: Opus East, Opus South, and Opus West. CEO Mark Rauenhorst said sharp declines in commercial real estate values and tight credit markets caused difficulties in refinancing assets and restructuring lending agreements.
| Aug 11, 2010
Best AEC Firms of 2011/12
Later this year, we will launch Best AEC Firms 2012. We’re looking for firms that create truly positive workplaces for their AEC professionals and support staff. Keep an eye on this page for entry information. +
| Aug 11, 2010
Clark Group, Mortenson among nation's busiest state/local government contractors, according to BD+C's Giants 300 report
A ranking of the Top 40 State/Local Government Contractors based on Building Design+Construction's 2009 Giants 300 survey. For more Giants 300 rankings, visit /giants
| Aug 11, 2010
Report: Building codes and regulations impede progress toward uber-green buildings
The enthusiasm for super green Living Buildings continues unabated, but a key stumbling block to the growth of this highest level of green building performance is an existing set of codes and regulations. A new report by the Cascadia Region Green Building Council entitled "Code, Regulatory and Systemic Barriers Affecting Living Building Projects" presents a case for fundamental reassessment of building codes.
| Aug 11, 2010
Call for entries: Building enclosure design awards
The Boston Society of Architects and the Boston chapter of the Building Enclosure Council (BEC-Boston) have announced a High Performance Building award that will assess building enclosure innovation through the demonstrated design, construction, and operation of the building enclosure.
| Aug 11, 2010
Portland Cement Association offers blast resistant design guide for reinforced concrete structures
Developed for designers and engineers, "Blast Resistant Design Guide for Reinforced Concrete Structures" provides a practical treatment of the design of cast-in-place reinforced concrete structures to resist the effects of blast loads. It explains the principles of blast-resistant design, and how to determine the kind and degree of resistance a structure needs as well as how to specify the required materials and details.