Through the first five months of 2015, nonresidential construction spending is having its second best year since the Census Bureau began tracking the metric in 2002.
According to the July 1 release, nonresidential construction spending increased 1.1% on a month-over-month basis and 8.1% on a year-over-year basis, and totals $669.6 billion on a seasonally adjusted, annualized basis. From January to May, nonresidential spending expanded by 7.1%; the only year in which the segment saw faster growth was 2007. Since then, growth over each year's initial five months has averaged only 1.8%.
Perhaps the most notable aspect of May's release was the extensive upward revisions to three of the previous four months' data. January, February and April saw their nonresidential construction spending estimates revised upward by 2%, 1.4% and 2.4%, respectively. The Census Bureau also increased the estimate for May 2014 by 1.4%.
"Though there continues to be discontent regarding performance of the U.S. economy, the current situation should be viewed positively," said Associated Builders and Contractors Chief Economist Anirban Basu. "The U.S. economy has now entered the mid-cycle portion of its recovery, which often represents a period of sustained progress for the average nonresidential construction firm. As with prior months, the industry progress continues to be led by the private sector. Among private segments, manufacturing-related construction was at the frontline of construction spending growth in May."
"Moderate economic growth will allow interest rates to rise gradually, helping extend this mid-cycle," said Basu. "Although it took several years to get to this point of the recovery, contractors will find themselves steadily becoming busier, with margins gradually expanding. The principle obstacle to progress will be skilled labor shortages, which eventually will translate into faster inflation, rising interest rates and the move into the final stage of the current economic expansion."
Nine of 16 nonresidential construction sectors experienced spending increases in May:
· Manufacturing-related construction spending expanded 6.2% in May and is up by 69.5% for the year.
· Office-related construction spending expanded 1.6% in May and is up 24.6% compared to the same time one year ago.
· Lodging-related construction spending was up 3.2% on a monthly basis and 30.6% on a year-over-year basis.
· Lodging-related construction spending was up 5.5% on a monthly basis and 17.6% on a year-over-year basis.
· Spending in the water supply category expanded 0.9% from April, but is down 6.8% on an annual basis.
· Religious spending gained 1.4% for the month and is up 9.2% from the same time last year.
· Highway and street-related construction spending expanded 2.2% in May and is up 2.1% compared to the same time last year.
· Conservation and development-related construction spending grew 8.6% for the month and is up 27.3% on a yearly basis.
· Amusement and recreation-related construction spending gained 5.8% on a monthly basis and is up 29.8% from the same time last year.
· Communication-related construction spending gained 3.3% for the month and is up 15.7% for the year.
Spending in seven nonresidential construction subsectors fell in May:
· Education-related construction spending fell 0.8% for the month, but is up 1.8% on a year-over-year basis.
· Power-related construction spending remained flat for the month, but is 23.5% lower than the same time one year ago.
· Sewage and waste disposal-related construction spending fell 2.2% for the month, but has grown 13.3% on a 12-month basis.
· Public safety-related construction spending fell 7.9% on a monthly basis and is down 11.8% on a year-over-year basis.
· Commercial construction spending fell 1.7% in March, but is up 11.4% on a year-over-year basis.
· Health care-related construction spending fell 0.6% for the month, but is up 3.1% compared to the same time last year.
· Construction spending in the transportation category fell 0.9% on a monthly basis, but has expanded 5.4% on an annual basis.
Related Stories
| Nov 2, 2010
A Look Back at the Navy’s First LEED Gold
Building Design+Construction takes a retrospective tour of a pace-setting LEED project.
| Nov 2, 2010
Wind Power, Windy City-style
Building-integrated wind turbines lend a futuristic look to a parking structure in Chicago’s trendy River North neighborhood. Only time will tell how much power the wind devices will generate.
| Nov 2, 2010
Energy Analysis No Longer a Luxury
Back in the halcyon days of 2006, energy analysis of building design and performance was a luxury. Sure, many forward-thinking AEC firms ran their designs through services such as Autodesk’s Green Building Studio and IES’s Virtual Environment, and some facility managers used Honeywell’s Energy Manager and other monitoring software. Today, however, knowing exactly how much energy your building will produce and use is survival of the fittest as energy costs and green design requirements demand precision.
| Nov 2, 2010
Yudelson: ‘If It Doesn’t Perform, It Can’t Be Green’
Jerry Yudelson, prolific author and veteran green building expert, challenges Building Teams to think big when it comes to controlling energy use and reducing carbon emissions in buildings.
| Nov 2, 2010
Historic changes to commercial building energy codes drive energy efficiency, emissions reductions
Revisions to the commercial section of the 2012 International Energy Conservation Code (IECC) represent the largest single-step efficiency increase in the history of the national, model energy. The changes mean that new and renovated buildings constructed in jurisdictions that follow the 2012 IECC will use 30% less energy than those built to current standards.
| Nov 1, 2010
Sustainable, mixed-income housing to revitalize community
The $41 million Arlington Grove mixed-use development in St. Louis is viewed as a major step in revitalizing the community. Developed by McCormack Baron Salazar with KAI Design & Build (architect, MEP, GC), the project will add 112 new and renovated mixed-income rental units (market rate, low-income, and public housing) totaling 162,000 sf, plus 5,000 sf of commercial/retail space.
| Nov 1, 2010
John Pearce: First thing I tell designers: Do your homework!
John Pearce, FAIA, University Architect at Duke University, Durham, N.C., tells BD+C’s Robert Cassidy about the school’s construction plans and sustainability efforts, how to land work at Duke, and why he’s proceeding with caution when it comes to BIM.
| Nov 1, 2010
Vancouver’s former Olympic Village shoots for Gold
The first tenants of the Millennium Water development in Vancouver, B.C., were Olympic athletes competing in the 2010 Winter Games. Now the former Olympic Village, located on a 17-acre brownfield site, is being transformed into a residential neighborhood targeting LEED ND Gold. The buildings are expected to consume 30-70% less energy than comparable structures.
| Oct 27, 2010
Grid-neutral education complex to serve students, community
MVE Institutional designed the Downtown Educational Complex in Oakland, Calif., to serve as an educational facility, community center, and grid-neutral green building. The 123,000-sf complex, now under construction on a 5.5-acre site in the city’s Lake Merritt neighborhood, will be built in two phases, the first expected to be completed in spring 2012 and the second in fall 2014.
