National nonresidential construction spending was down 0.4% in August, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $859.3 billion for the month.
Spending was down on a monthly basis in 10 of 16 nonresidential subcategories. Private nonresidential spending was down 0.1%, while public nonresidential construction spending was down 0.8% in August.
āThe disparity between high contractor confidence and worrisome macroeconomic outcomes persists,ā said ABC National Chief Economist Anirban Basu. āAccording to ABCās Construction Confidence Index and Backlog Indicator, many contractors remain in expansion mode and expect to experience rising sales and profit margins going forward. Many also expect their employment levels to be higher in six months.
āBut the nonresidential construction data indicate that consistent spending growth remains elusive,ā said Basu. āGiven the rising costs of project financing and delivering construction services, that is not surprising. Arguably, it is contractor confidence that is counterintuitive.
āReconciling strong microeconomic perspective with weak macroeconomic outcomes involves looking at segment-specific data,ā said Basu. āWhile some segments like office and lodging continue to struggle in the context of behavioral shifts wrought by the pandemic, other segments are showing significant momentum. This is especially apparent in certain public construction segments like water/sewer, highway/street and flood control.ā
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