Nonresidential construction spending expanded in October for the third consecutive month (September's estimate was revised higher than August's) according to analysis of U.S. Census Bureau data released by Associated Builders and Contractors (ABC) today. Nonresidential construction spending totaled $701.8 billion in October on a seasonally adjusted annualized rate, a 1% increase on a monthly basis and an 11% increase on a yearly basis.
Private sector nonresidential construction spending added 0.6% for the month, reaching a total of $403.4 billion. Nonresidential spending in the public sector gained 1.4% from September, totaling $298.4 billion.
"The data tell a simple story: October was a strong month for nonresidential construction spending," said ABC Chief Economist Anirban Basu. "Interestingly, in October, publicly financed construction spending expanded more rapidly than private construction spending, representing a stark reversal from prior years when construction's recovery was motivated almost exclusively by private spending growth. There is reason to believe that public finances will continue to improve, which should help bolster nonresidential construction's fortunes into 2016.
"Construction spending continues to be supported by ongoing improvement in state and local government finances, inexpensive money, availability of both debt and equity to finance projects, growing demand for office and other forms of space, and added levels of confidence among key economic actors," Basu said.
Spending increased in 10 of 16 nonresidential construction sectors on a monthly basis in October:
- Public safety-related spending expanded by 15.7% for the month but fell by 2.2% from October 2014.
- Conservation and development-related spending gained 12.2% on a monthly basis and 9.6% on a yearly basis.
- Spending in the communication category increased by 7.3% since September 2015 and 19.2% since October 2014.
- Manufacturing-related spending expanded by 3% month-over-month and 40.5% year-over-year.
- Spending the water supply category grew by 2.4% for the month and 4.6% since the same time last year.
- Health care-related spending grew 1.3% from September and 6.1% from October of last year.
- Highway and street-related spending expanded by 1.1% on a monthly basis and 6% on a yearly basis.
- Transportation-related spending grew 0.9% month-over-month and 4.2% year-over-year.
- Office-related spending inched 0.5% higher on a monthly basis and 15.3% higher on a yearly basis.
- Spending in the educational category expanded by 0.4% from September 2015 and 9.4% from October 2014.
Spending in six of the nonresidential construction subsectors fell in October on a monthly basis:
- Spending in the amusement and recreation category fell by 0.3% for the month but increased by 24.1% on a yearly basis.
- Lodging-related spending declined 0.4% on a monthly basis but gained 29.6% year-over-year.
- Commercial-related spending dipped 0.5% from September 2015 and 2.2% from October 2014.
- Spending in the sewage and waste disposal category fell 0.7% on a monthly basis but expanded by 6.2% on a yearly basis.
- Power-related spending fell 1.9% for the month but is up 5.1% year-over-year.
- Religious-related spending dipped 3.4% on a month-ago basis but is up 10.3% from the same time last year.
To view the previous spending report, click here.
Related Stories
High-rise Construction | Jun 23, 2015
The world's best new skyscrapers for 2015
One World Trade Center and Abu Dhabi's Burj Mohammed Bin Rashid Tower are among the four towers named Best Tall Buildings by the Council on Tall Buildings and Urban Habitat.
BIM and Information Technology | Jun 21, 2015
11 tips for mastering 3D printing in the AEC world
Early adopters provide first-hand advice on the trials and tribulations of marrying 3D printing with the science of building technology.
Building Materials | Jun 12, 2015
Construction materials prices up in May, down year-over-year
Prices for inputs to construction industries rose by 1.1% in May—the largest month-over-month increase in more than two years.
Office Buildings | Jun 12, 2015
Houston's energy sector keeps office construction humming
Colliers International projects continued expansion this year in its quarterly report on national office market.
Smart Buildings | Jun 11, 2015
Google launches company to improve city living
The search engine giant is yet again diversifying its products. Google has co-created a startup, called Sidewalk Labs, that will focus on “developing innovative technologies to improve cities.”
Contractors | Jun 8, 2015
ABC: 49 states report decline in construction unemployment rate
Five Plain States reported the lowest unemployment rates for construction workers in April.
Contractors | Jun 5, 2015
FMI's quarterly survey finds contractors mostly optimistic about their growth
The overall economy, as well as the economy in which they do business, might be down, but contractor panelists who provided these insights still see nonresidential construction on the upswing, according to FMI’s latest report.
Contractors | Jun 2, 2015
Weather to blame for decline in Construction Backlog Indicator
Following an intense winter season, the Associated Builders and Contractors' Construction Backlog Indicator (CBI) revealed a 3.2% decline during the first quarter of 2015.
Contractors | Jun 1, 2015
Nonresidential construction spending surges in April
Nonresidential construction is up by a solid 8.8% over the past year, consistent with ABC's forecast of high single-digit growth.
Multifamily Housing | Jun 1, 2015
Sacramento moves forward on multifamily project with new modular supplier
Guerdon Modular Buildings will provide modules for 118 apartments.