Construction Spending Decreased 0.3% in February
The Census Bureau’s recent report indicates a mixed picture for construction spending in February 2024. The total construction spending reached a seasonally adjusted annual rate of $2,091.5 billion, marking a slight decrease of 0.3 percent from January’s revised estimate of $2,096.9 billion. However, this figure represents a significant 10.7 percent increase from February 2023’s estimate of $1,889.6 billion.
Breaking down the numbers, private construction spending remained virtually unchanged, with a minor adjustment from January’s $1,616.8 billion to February’s $1,617.1 billion. Public construction spending, however, saw a decrease of 1.2 percent, falling from January’s $480.1 billion to $474.4 billion in February.
Accompanying graphs illustrate trends in construction spending since 1993, with one focusing on the split between private residential and nonresidential spending, as well as public spending. It’s worth noting that these figures are in nominal dollars and not adjusted for inflation. The data show that residential (red) spending is currently 7.1% below its peak in 2022. Non-residential (blue) spending has also dropped, now 1.1% below its peak from two months prior. Similarly, public construction spending is 1.9% lower than its peak, also from two months ago.
Another graph displays the year-over-year changes in construction spending. On this basis, private residential construction spending has increased by 6.3%. In comparison, non-residential spending has risen by 12.6%, and public spending has seen a notable increase of 16.8% compared to last year.
Despite these increases, the overall construction spending fell short of the consensus expectations, which predicted a 0.5% rise. Moreover, the total construction spending for the past two months has undergone downward revisions. This trend suggests a potential onset of weakening in private non-residential construction spending.
