National nonresidential construction spending increased by 1.6% in January and is up 5.1% on a year-ago basis, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, spending totaled a record $806.9 billion in January.
Private nonresidential spending rose 0.8% on a monthly basis and is up 0.5% compared to the same time last year. Public nonresidential construction spending also increased, rising 2.6% for the month and 12.3% on a year over year basis.
“Despite all the focus on the dislocating impacts of the coronavirus, construction—a key element of the U.S. economy—continues to perform,” said ABC Chief Economist Anirban Basu. “For the first time in history, the volume of nonresidential construction spending exceeded $800 billion on an annualized basis and now stands at an all-time high. Both public and private nonresidential construction spending expanded to start 2020, a reflection of the broader economic momentum evident over the last several years. Backlog remains healthy, according to the ABC Construction Backlog Indicator, and with the nation continuing to add jobs, there is more demand for public and private construction and additional funding resources. This is especially apparent in several infrastructure categories, in which spending growth continues to be robust due to healthier state and local government finances.
“That said, there is no question that the coronavirus has significantly compromised both global and national economic momentum over the past two to three weeks,” said Basu. “U.S. manufacturing and shipping segments have begun to soften, with significant reductions in container volume already being reported at several major U.S. ports. While the crisis is expansive enough to potentially drive the economy into recession, the question is whether the crisis is severe enough to countervail current U.S. economic momentum.
“At this time, it is unclear how coronavirus will affect materials prices,” said Basu. “Certain construction components, whether from China or elsewhere, may experience inadequate supply during the weeks ahead, and the more general impact will be decreased input prices due to lower demand. This is likely to be the case for a number of key commodities, including those related to energy.”
Related Stories
Market Data | May 30, 2019
Construction employment increases in 250 out of 358 metros from April 2018 to April 2019
Demand for work is outpacing the supply of workers.
Market Data | May 24, 2019
Construction contractors confidence remains high in March
More than 70% of contractors expect to increase staffing levels over the next six months.
Market Data | May 22, 2019
Slight rebound for architecture billings in April
AIA’s ABI score for April showed a small increase in design services at 50.5 in April.
Market Data | May 9, 2019
The U.S. hotel construction pipeline continues to grow in the first quarter as the economy shows surprising strength
Projects currently under construction stand at 1,709 projects/227,924 rooms.
Market Data | May 9, 2019
Construction input prices continue to rise
Nonresidential input prices rose 0.9% compared to March and are up 2.8% on an annual basis.
Market Data | May 7, 2019
Construction costs in major metros continued to climb last year
Latest Rider Levett Bucknall report estimates rise at more than double the rate of 2018 Growth Domestic Product.
Market Data | Apr 29, 2019
U.S. economic growth crosses 3% threshold to begin the year
Growth was fueled by myriad factors, including personal consumption expenditures, private inventory investment, surprisingly rapid growth in exports, state and local government spending and intellectual property.
Market Data | Apr 18, 2019
ABC report: 'Confidence seems to be making a comeback in America'
The Construction Confidence Index remained strong in February, according to the Associated Builders and Contractors.
Market Data | Apr 16, 2019
ABC’s Construction Backlog Indicator rebounds in February
ABC's Construction Backlog Indicator expanded to 8.8 months in February 2019.
Market Data | Apr 8, 2019
Engineering, construction spending to rise 3% in 2019: FMI outlook
Top-performing segments forecast in 2019 include transportation, public safety, and education.