National nonresidential construction spending increased 0.8% in July, 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 $847.6 billion for the month.
Spending was up on a monthly basis in 13 of the 16 nonresidential subcategories. Private nonresidential spending was up 0.4%, while public nonresidential construction spending was up 1.5% in July.
“The nonresidential sector continues to grapple with rising borrowing costs, elevated materials and labor costs and pervasive economic pessimism,” said ABC Chief Economist Anirban Basu. “Despite a modest increase in July, nonresidential construction spending remains below its pre-pandemic level. There is, however, at least one bright spot for the industry: publicly financed construction. State and local governments are flush with cash, and considerable funding is slated for various forms of infrastructure. In July, spending in the highway and street category increased 4.4%, while spending in the public safety category rose 2.3%.
“For privately financed construction, circumstances could get worse before they get better,” said Basu. “The Federal Reserve recently recommitted to further tightening monetary policy. Market sentiment quickly turned negative. Rather than disappear, supply chain challenges are proliferating in much of the world, including in Europe and China, and the risk of recession is elevated. This is simply not a set of circumstances conducive to rapid nonresidential construction spending growth, and according to the most recent Construction Confidence Index, just 31% of contractors expect their profit margins to grow over the next six months.”
Related Stories
Mass Timber | May 8, 2024
Portland's Timberview VIII mass timber multifamily development will offer more than 100 affordable units
An eight-story, 72,000-sf mass timber apartment building in Portland, Ore., topped out this winter and will soon offer over 100 affordable units. The structure is the tallest affordable housing mass timber building and the first Type IV-C affordable housing building in the city.
K-12 Schools | May 7, 2024
World's first K-12 school to achieve both LEED for Schools Platinum and WELL Platinum
A new K-12 school in Washington, D.C., is the first school in the world to achieve both LEED for Schools Platinum and WELL Platinum, according to its architect, Perkins Eastman. The John Lewis Elementary School is also the first school in the District of Columbia designed to achieve net-zero energy (NZE).
Healthcare Facilities | May 6, 2024
Hospital construction costs for 2024
Data from Gordian breaks down the average cost per square foot for a three-story hospital across 10 U.S. cities.
MFPRO+ Special Reports | May 6, 2024
Top 10 trends in affordable housing
Among affordable housing developers today, there’s one commonality tying projects together: uncertainty. AEC firms share their latest insights and philosophies on the future of affordable housing in BD+C's 2023 Multifamily Annual Report.
Retail Centers | May 3, 2024
Outside Las Vegas, two unused office buildings will be turned into an open-air retail development
In Henderson, Nev., a city roughly 15 miles southeast of Las Vegas, 100,000 sf of unused office space will be turned into an open-air retail development called The Cliff. The $30 million adaptive reuse development will convert the site’s two office buildings into a destination for retail stores, chef-driven restaurants, and community entertainment.
Codes and Standards | May 3, 2024
New York City considering bill to prevent building collapses
The New York City Council is considering a proposed law with the goal of preventing building collapses. The Billingsley Structural Integrity Act is a response to the collapse of 1915 Billingsley Terrace in the Bronx last December.
Student Housing | May 3, 2024
Student housing construction dips in the first quarter of 2024
Investment in college dorms dipped slightly in the first quarter of 2024, but remains higher than a year ago.
Contractors | May 1, 2024
Nonresidential construction spending rises 0.2% in March 2024 to $1.19 trillion
National nonresidential construction spending increased 0.2% in March, 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 $1.19 trillion.
K-12 Schools | Apr 30, 2024
Fully electric Oregon elementary school aims for resilience with microgrid design
The River Grove Elementary School in Oregon was designed for net-zero carbon and resiliency to seismic events, storms, and wildfire. The roughly 82,000-sf school in a Portland suburb will feature a microgrid—a small-scale power grid that operates independently from the area’s electric grid.
AEC Tech | Apr 30, 2024
Lack of organizational readiness is biggest hurdle to artificial intelligence adoption
Managers of companies in the industrial sector, including construction, have bought the hype of artificial intelligence (AI) as a transformative technology, but their organizations are not ready to realize its promise, according to research from IFS, a global cloud enterprise software company. An IFS survey of 1,700 senior decision-makers found that 84% of executives anticipate massive organizational benefits from AI.
