WASHINGTON, April 1—National nonresidential construction spending declined 1.0% in February, 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 $1.179 trillion.
In February, there was a downturn in spending across most nonresidential construction areas, with 15 of the 16 sectors experiencing decreases. Specifically, private sector nonresidential construction spending fell by 0.9%, and public sector spending in this realm declined by 1.2%.
Commenting on this trend, a leading industry economist, Anirban Basu, noted, “Nearly every nonresidential construction sector saw a drop in spending in February. Sharp declines were particularly evident in healthcare, commercial, and water supply sectors, with decreases of 2.2%, 1.9%, and 1.8%, respectively. While some may attribute the January and February declines in spending to winter weather conditions, others might view it as a significant alert for contractors, signaling that the repercussions of increasing interest rates are beginning to emerge.”
Basu further elaborated on the complexity of interpreting these figures, saying, “Deciphering these statistics isn’t straightforward. Despite the month-to-month decreases in 15 out of the 16 sectors on a seasonally adjusted basis, there’s a silver lining: all sectors have shown an increase in spending year-over-year. Remarkably, in ten of these categories, there’s been an increase in spending of more than 10%, with public safety construction growing by 36% and manufacturing by 32%.”
