Blame it on the weather. That's what many economists have been doing over the past two months as economic data continue to disappoint. Retail sales, durable goods orders, and other categories have not been as strong as anticipated.
Nonresidential construction has often proved an exception, with the industry's momentum gaining steam recently. However, in February, nonresidential construction spending remained virtually unchanged, inching down 0.1% on a monthly basis, according to the April 1 release from the U.S. Census Bureau.
The February 2015 spending figure is 4.6% higher than February 2014, as spending for the month totaled $611.5 billion on a seasonally adjusted annualized basis. The estimate for January spending was revised downward, from $614.1 billion to $611.9 billion, while the government revised December's spending estimate upward from $627 billion to $629.3 billion.
"Construction is impacted more by weather than just about any economic segment, and the impact of February's brutal weather is evident in the government's spending figure," said Associated Builders and Contractors Chief Economist Anirban Basu. "ABC continues to forecast a robust nonresidential construction spending recovery in 2015, despite the most recent monthly data, with the obvious exceptions of industry segments most directly and negatively impacted by declines in energy prices.
"The broader U.S. economy has not gotten off to as good a start in 2015 as many had expected with consumer spending growth frustrated by thriftier than anticipated shoppers," said Basu. "With winter behind us and temperatures warming, the expectation is that economic growth will roar back during the second quarter, which is precisely what happened last year. To the extent that this proves to be true, nonresidential construction's recovery can be expected to persist."
Seven of 16 nonresidential construction subsectors posted increases in spending in February on a monthly basis.
- Manufacturing-related spending expanded 6.8 percent in February and is up 37.9% on a year-over-year basis.
- Conservation and development-related construction spending expanded 11% for the month and is up 19.8% on a yearly basis.
- Office-related construction spending expanded 2.4% in February and is up 19% from the same time one year ago.
- Amusement and recreation-related construction spending gained 2% on a monthly basis and is up 22.5% from the same time last year.
- Education-related construction spending grew 0.3% for the month, but is down 0.6% on a year-over-year basis.
- Construction spending in the transportation category grew 0.6% on a monthly basis and has expanded 9.3% on an annual basis.
- Lodging-related construction spending was up 5% on a monthly basis and 10.4% on a year-over-year basis.
Spending in nine nonresidential construction subsectors failed to rise in February.
- Healthcare-related construction spending fell 0.9% for the month and is down 4.5% for the year.
- Spending in the water supply category dropped 7.8% from January, but is still 7.4% higher than at the same time last year.
- Public safety-related construction spending lost 2.2% on a monthly basis and is down 9.6% on a year-over-year basis.
- Commercial construction spending lost 1.9% in February, but is up 13.5% on a year-over-year basis.
- Religious spending fell 4.8% for the month and is down 10.3% from the same time last year.
- Sewage and waste disposal-related construction spending shed 1.4% for the month, but has grown 19.9% on a 12-month basis.
- Power-related construction spending fell 4.5% for the month and is 17.2% lower than at the same time one year ago.
- Lodging construction spending is down 4.4% on a monthly basis, but is up 18.2% on a year-over-year basis.
- Sewage and waste disposal-related construction spending shed 7.5% for the month, but has grown 16% on a 12-month basis.
- Power-related construction spending fell 1.1% for the month and is 13.2% lower than at the same time one year ago.
- Communication-related construction spending fell 6.1% for the month and is down 15.5% for the year.
- Highway and street-related construction spending was unchanged in February and is up 3.3% compared to the same time last year.
To view the previous spending report, click here.
Related Stories
Healthcare Facilities | Apr 13, 2023
Healthcare construction costs for 2023
Data from Gordian breaks down the average cost per square foot for a three-story hospital across 10 U.S. cities.
Higher Education | Apr 13, 2023
Higher education construction costs for 2023
Fresh data from Gordian breaks down the average cost per square foot for a two-story college classroom building across 10 U.S. cities.
Office Buildings | Apr 13, 2023
L.A. headquarters for startup Califia Farms incorporates post-pandemic hybrid workplace design concepts
The new Los Angeles headquarters for fast-growing Califia Farms, a brand of dairy alternative products, was designed by SLAM with the post-Covid hybrid work environment in mind. Located in Maxwell Coffee House, a historic production facility built in 1924 that has become a vibrant mixed-use complex, the office features a café bordered by generous meeting rooms.
3D Printing | Apr 11, 2023
University of Michigan’s DART Laboratory unveils Shell Wall—a concrete wall that’s lightweight and freeform 3D printed
The University of Michigan’s DART Laboratory has unveiled a new product called Shell Wall—which the organization describes as the first lightweight, freeform 3D printed and structurally reinforced concrete wall. The innovative product leverages DART Laboratory’s research and development on the use of 3D-printing technology to build structures that require less concrete.
Market Data | Apr 11, 2023
Construction crane count reaches all-time high in Q1 2023
Toronto, Seattle, Los Angeles, and Denver top the list of U.S/Canadian cities with the greatest number of fixed cranes on construction sites, according to Rider Levett Bucknall's RLB Crane Index for North America for Q1 2023.
University Buildings | Apr 11, 2023
Supersizing higher education: Tracking the rise of mega buildings on university campuses
Mega buildings on higher education campuses aren’t unusual. But what has been different lately is the sheer number of supersized projects that have been in the works over the last 12–15 months.
Contractors | Apr 11, 2023
The average U.S. contractor has 8.7 months worth of construction work in the pipeline, as of March 2023
Associated Builders and Contractors reported that its Construction Backlog Indicator declined to 8.7 months in March, according to an ABC member survey conducted March 20 to April 3. The reading is 0.4 months higher than in March 2022.
Contractors | Apr 10, 2023
What makes prefabrication work? Factors every construction project should consider
There are many factors requiring careful consideration when determining whether a project is a good fit for prefabrication. JE Dunn’s Brian Burkett breaks down the most important considerations.
Mixed-Use | Apr 7, 2023
New Nashville mixed-use high-rise features curved, stepped massing and wellness focus
Construction recently started on 5 City Blvd, a new 15-story office and mixed-use building in Nashville, Tenn. Located on a uniquely shaped site, the 730,000-sf structure features curved, stepped massing and amenities with a focus on wellness.
Smart Buildings | Apr 7, 2023
Carnegie Mellon University's research on advanced building sensors provokes heated controversy
A research project to test next-generation building sensors at Carnegie Mellon University provoked intense debate over the privacy implications of widespread deployment of the devices in a new 90,000-sf building. The light-switch-size devices, capable of measuring 12 types of data including motion and sound, were mounted in more than 300 locations throughout the building.
