Nonresidential construction spending fell in September for the first time in eight months, the U.S. Census Bureau reported, but the monthly drop in spending is not a cause for concern according to analysis by Associated Builders and Contractors (ABC). Nonresidential construction spending fell by 0.1% from August, totaling $692.8 billion on a seasonally adjusted annualized basis.
September's year-over-year increase of 12.4% is the largest increase since April 2008. After falling in two consecutive months, public nonresidential construction spending grew by 0.7% in September while private sector construction spending fell by 0.7% for the month.
"The last several months have generally been associated with sizable increases in nonresidential construction," said ABC Chief Economist Anirban Basu. "Today's release, while not particularly upbeat, does not alter the fact that nonresidential construction spending continues to recover and that most contractors are busier than they were a year ago.
"Although there are many potential forces at work that resulted September's monthly construction spending decline, most are not alarming. With construction materials prices falling, contractors may be able to offer somewhat lower prices for their services, helping to suppress growth in construction value put in place. It is also conceivable that some construction work is being slowed by an ongoing lack of available skilled personnel. This factor has certainly helped to slow residential construction, and it seems reasonable to presume that some nonresidential contractors would face similar issues.
Seven nonresidential construction sectors experienced spending increases in September on a monthly basis:
- Educational-related spending expanded by 2% for the month and 11.5% for the year.
- Spending in the religious category grew by 5.6% on a monthly basis and 0.8% year-over-year.
- Amusement and transportation-related spending rose by 0.2% from August and 30.6% from September of last year.
- Transportation-related spending expanded by 1.6% from a month ago and 10.2% from a year ago.
- Highway and street-related construction spending inched 0.3% higher for the month and is up 10% from the same time last year.
- Sewage and waste disposal-related spending rose by 1.1% from August and 12.9% from September of last year.
- Spending in the water supply category gained 4.3% from the previous month and 5.6% on a year-ago basis.
Spending in nine nonresidential construction subsectors fell in September on a monthly basis:
- Spending in the lodging category fell by 0.7% for the month but is up 32.8% from September 2014.
- Office-related spending dipped 0.4% from August but is 19.3% higher than at the same time last year.
- Spending in the commercial category fell by 1.1% on a monthly basis and by 2% on a yearly basis.
- Health care-related spending inched 0.1% lower for the month but is up 9% on a year-ago basis.
- Public safety-related spending fell 3% month-over-month and 4.8% year-over-year.
- Spending in the communication-category declined 2.7% from August but is up 10.2% from the same time last year.
- Power-related construction spending fell 1.7% on a monthly basis but expanded 1.9% over the previous twelve months.
- Conservation and development-related spending lost 6% for the month but is still 1.6% higher than at the same time last year.
- Manufacturing related spending fell 0.4% for the month but is still up 41.3% from September 2014.
To view the previous spending report, click here.
Related Stories
| May 6, 2013
SAFTI FIRST announces 3D Autodesk Revit models for fire rated wall, window, and door systems
SAFTI FIRST, leading USA-manufacturer of fire rated glass and faming systems, is proud to announce that Autodesk Revit models are now available for its fire rated walls, window and door systems via www.safti.com and Autodesk Seek.
| May 6, 2013
7 major multifamily residential projects in the works
A $140 million redevelopment of a landmark, 45-building apartment complex in Los Angeles is among the nation's significant multifamily developments under way.
| May 3, 2013
5 common failures in paints and coatings
As experienced designers, contractors, and owners know, most paint and coating problems are correctable, but some are especially stubborn to address. Here is a partial compendium of typical failure modes and methods for addressing the problem.
| May 3, 2013
'LEED for all GSA buildings,' says GSA Green Building Advisory Committee
The Green Building Advisory Committee established by the General Services Administration, officially recommended to GSA that the LEED green building certification system be used for all GSA buildings as the best measure of building efficiency.
| May 3, 2013
SMPS Foundation accepting applications for Ron Garikes Student Scholarship
The SMPS Foundation is now accepting scholarship applications from eligible students majoring in marketing, communications, or public relations who are planning a career in professional services marketing in the architecture, engineering, and construction industry.
| May 3, 2013
Another edible city? Artist creates model city with chewing gum
French artist Jeremy Laffon pieced together a model city with thousands of sticks of mint-green chewing gum.
| May 2, 2013
First look: UC-Davis art museum by SO-IL and Bohlin Cywinski Jackson
The University of California, Davis has selected emerging New York-based practice SO-IL to design a new campus’ art museum, which is envisioned to be a “regional center of experimentation, participation and learning.”
| May 2, 2013
A snapshot of the world's amazing construction feats (in one flashy infographic)
From the Great Pyramids of Giza to the U.S. Interstate Highway System, this infographic outlines interesting facts about some of the world's most notable construction projects.
| May 2, 2013
Holl-designed Campbell Sports Center completed at Columbia
Steven Holl Architects celebrates the completion of the Campbell Sports Center, Columbia University’s new training and teaching facility.
| May 2, 2013
BIM group proposes uniform standards for how complete plans need to be
A nationwide group of Building Information Modeling users, known as the BIMForum, is seeking industry input on a proposed set of standards establishing how complete Building Information Models (BIMs) need to be for different stages of the design and construction process.