Nonresidential construction spending crested the $700 billion mark on a seasonally adjusted annualized basis in January for the first time since March 2009, according to analysis of U.S. Census Bureau data released today by Associated Builders and Contractors (ABC).
Nonresidential construction spending expanded 2.5% on a monthly basis and 12.3% on a yearly basis, totaling $701.9 billion. The Census Bureau upwardly revised December's estimate from $681.2 billion to $684.5 billion, though they downgraded November's figure from $683.7 to $680.5 million. Private nonresidential construction spending increased by 1% for the month, while its public counterpart expanded by 4.6%.
"After several months of relatively weak nonresidential construction spending data, today's data release was most welcome," ABC Chief Economist Anirban Basu said. "While January is a difficult month to interpret and one that should not be overly emphasized, the fact of the matter is that the year-over-year performance in spending is consistent with a host of industry indicators. For many months, the average contractor has been reporting decent backlog. Measures of industry confidence have remained stable even in the face of adverse news coming from various parts of the world.
"While the nonresidential construction spending recovery appears to remain in place, the industry's overall outlook remains murky," Basu said. "The global economy remains weak, and domestic corporate profitability has been slipping. The U.S. economic recovery continues to be under-diversified, with consumers continuing to lead the way. If corporate profitability continues to struggle, given falling exports and a general lack of confidence among CEOs, the pace of employment growth will slow over the course of 2016. That will presumably affect consumer spending, which is already being hampered by rising health care costs. That, in turn, could jeopardize the ongoing economic recovery, now on its way to completing its seventh year."
Spending increased in January on a monthly basis in 10 of 16 nonresidential construction sectors:
- Spending in the highway and street category expanded 14.6% from December 2015 and is 33.9 higher than in January 2015.
- Sewage and waste disposal-related spending expanded 4% for the month and 1.4% from the same time last year.
- Spending in the amusement and recreation category climbed 0.7% on a monthly basis and 16.9% on a year-over-year basis.
- Conservation and development-related spending is 10% higher on a monthly basis and 1.6% higher on a yearly basis.
- Lodging-related spending is up 6.3% for the month and is up 34.8% on a year-ago basis.
- Spending in the religious category grew 4.2% for the month and 0.2% from January 2015.
- Manufacturing-related spending expanded 4.2% on a monthly basis and is up 11.3% on a yearly basis.
- Spending in the power category expanded 2.9% from December 2015 and is 8.1% higher than in January 2015.
- Water supply-related spending expanded 2% on a monthly basis but fell 7.9% on a yearly basis.
- Spending in the office category grew 0.2% from December 2015 and is up 19.6% from January 2015.
Spending in six of the nonresidential construction subsectors fell in January on a monthly basis:
- Commercial-related construction spending fell 4.3% for the month but grew 0.8% on a year-over-year basis.
- Educational-related construction spending fell 1.1% on a monthly basis, but expanded 12.1% on a yearly basis.
- Transportation-related spending fell 2.5% month-over-month, but expanded 0.6% year-over-year.
- Health care-related spending fell 0.1% month-over-month but is up 1.8% year-over-year.
- Public safety-related spending is down 1.5% for the month and 3.2% from the same time one year ago.
- Communication-related spending fell by 4.2% month-over-month but expanded 27.2% year-over-year.
Related Stories
| Sep 21, 2010
New BOMA-Kingsley Report Shows Compression in Utilities and Total Operating Expenses
A new report from the Building Owners and Managers Association (BOMA) International and Kingsley Associates shows that property professionals are trimming building operating expenses to stay competitive in today’s challenging marketplace. The report, which analyzes data from BOMA International’s 2010 Experience Exchange Report® (EER), revealed a $0.09 (1.1 percent) decrease in total operating expenses for U.S. private-sector buildings during 2009.
| Sep 21, 2010
Forecast: Existing buildings to earn 50% of green building certifications
A new report from Pike Research forecasts that by 2020, nearly half the green building certifications will be for existing buildings—accounting for 25 billion sf. The study, “Green Building Certification Programs,” analyzed current market and regulatory conditions related to green building certification programs, and found that green building remain robust during the recession and that certifications for existing buildings are an increasing area of focus.
| Sep 21, 2010
Middough Inc. Celebrates its 60th Anniversary
Middough Inc., a top ranking U.S. architectural, engineering and management services company, announces the celebration of its 60th anniversary, says President and CEO, Ronald R. Ledin, PE.
| Sep 16, 2010
Green recreation/wellness center targets physical, environmental health
The 151,000-sf recreation and wellness center at California State University’s Sacramento campus, called the WELL (for “wellness, education, leisure, lifestyle”), has a fitness center, café, indoor track, gymnasium, racquetball courts, educational and counseling space, the largest rock climbing wall in the CSU system.
| Sep 13, 2010
Community college police, parking structure targets LEED Platinum
The San Diego Community College District's $1.555 billion construction program continues with groundbreaking for a 6,000-sf police substation and an 828-space, four-story parking structure at San Diego Miramar College.
| Sep 13, 2010
Campus housing fosters community connection
A 600,000-sf complex on the University of Washington's Seattle campus will include four residence halls for 1,650 students and a 100-seat cafe, 8,000-sf grocery store, and conference center with 200-seat auditorium for both student and community use.