According to an Associated Builders and Contractors analysis of U.S. Census Bureau data released today, national nonresidential construction spending rose 0.3% in April, totaling $792.6 billion on a seasonally adjusted annualized basis, which is a 6.4% increase compared to the same time last year. While public nonresidential spending expanded 4.8% on a monthly basis and increased 15.4% since April 2018, private nonresidential spending fell 2.9% in April and is up just 0.6 % year-over-year.
Among the 16 nonresidential construction spending categories, nine experienced an increase in monthly spending, with the largest increases registered in water supply (9.8%), highway and street (6.8%) and transportation (3.9%). Manufacturing (-7.1%) and commercial (-3.7%) experienced the largest decreases in April, though manufacturing spending is still up 10.9% compared to the same time last year.
“Today’s data release shows that nonresidential construction spending remains vigorous in America,” said ABC Chief Economist Anirban Basu. “While April’s monthly nonresidential construction spending growth of 0.3 percent appears lackluster, this was largely the result of a sizeable upward revision to March construction spending figures.
“Today’s data release also indicates that the baton has now been fully passed,” said Basu. “Earlier in the recovery, nonresidential construction spending growth was primarily driven by private segments. Low interest rates and abundant liquidity helped fuel private investment in hotels, data centers, casinos, fulfillment centers and other forms of private construction. But over the past year, private nonresidential construction spending has barely budged. Meanwhile, public residential spending is up 15.4 percent and April’s spending growth was led by water supply and highway/street.
“Given current levels of backlog, which expanded to 9.5 months in March 2019, nonresidential construction spending should remain elevated,” said Basu. “That said, risks of recession in 2020 are rapidly rising, which has the potential to reduce construction activity in 2021 and/or 2022.”
Related Stories
Market Data | Jun 26, 2020
5 must reads for the AEC industry today: June 26, 2020
Restoration of 1930s El Paso hotel completes and Arc offers tools, analytics for safe workplace re-entry.
Market Data | Jun 25, 2020
Commercial Construction Index drops amid Coronavirus pandemic, but contractors poised for near-term recovery
Contractors quickly prioritized worker health and safety, and 1 in 3 plan to hire more workers in the next 6 months.
Market Data | Jun 25, 2020
7 must reads for the AEC industry today: June 25, 2020
CDC to build the most advanced high containment laboratory in the country and architecture billings downward trajectory moderates.
Market Data | Jun 24, 2020
Architecture billings downward trajectory moderates
AIA’s Architecture Billings Index (ABI) score for May was 32.0 compared to 29.5 in April, but still represents a significant decrease in services provided by U.S. architecture firms.
Market Data | Jun 24, 2020
8 must reads for the AEC industry today: June 24, 2020
San Francisco's apartment market goes in reverse and WATG designs a solution for isolating without sacrificing social connectivity.
Market Data | Jun 23, 2020
National survey reveals pandemic's impact on college students' mental health, remote learning, families' income and more
Of 2,500 student respondents, 75% feel more anxious or stressed, 57% said they lost their summer jobs and 90% want to return to campus in the fall.
Market Data | Jun 23, 2020
7 must reads for the AEC industry today: June 23, 2020
Gyms are going bacnkrupt and leaving gaps in shopping centers and how hotels are trying to keep guests and employees safe.
Market Data | Jun 22, 2020
New House infrastructure package will provide needed investments in aging infrastructure, support economic recovery, and create jobs
The Moving Forward Act’s proposed $1.5 trillion in new investments will improve range of public infrastructure, creating needed demand for construction while making the economy more efficient.
Market Data | Jun 22, 2020
7 must reads for the AEC industry today: June 22, 2020
Construction employment rises from April to May in 45 states and the first building in the U.S. designed for post COVID-19 environment.
Market Data | Jun 22, 2020
Construction employment rises from April to May in 45 states, slips in 5
Rebound from April job losses reflects one-shot help from paycheck protection program loans and easing of stay-at-home orders, but cancellations and state and local deficits imply further cuts ahead.