National nonresidential construction spending fell 1.2% 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, spending totaled $809.1 billion for the month.
Of the 16 nonresidential subcategories, 10 were down on a monthly basis. Private nonresidential spending declined 1.0% while public nonresidential construction spending was down 1.3% in July.
“There are two primary countervailing forces influencing the trajectory of nonresidential construction spending,” said Basu. “The first is a force for good and involves the reopening of the economy and associated rebound in overall economic activity. Despite the lingering pandemic, third quarter GDP growth is likely to be quite strong. All things being equal, this would tend to strengthen business for contractors.
'Next year is shaping up to be an especially harsh one for many contractors, especially as some are already indicating that they are nearing the end of their backlog. The wild card, as is often the case, is Congress.'
“However, the second force at work is not benign and appears to be the stronger of the two,” said Basu. “The crisis has resulted in tighter project financing conditions, battered state and local government finances, substantial commercial vacancy and uncertainty regarding the future of key segments, such as office and lodging. And while backlog was strong at the start of the year, contractors indicate that it is now declining rapidly, in part due to abundant project cancellations.”
“Next year is shaping up to be an especially harsh one for many contractors, especially as some are already indicating that they are nearing the end of their backlog,” said Basu. “The wild card, as is often the case, is Congress. Another stimulus package could go a long way toward improving the trajectory of overall nonresidential construction spending, particularly one with a sizable infrastructure component. The upshot is that declines in nonresidential construction spending are likely even in the context of broader economic recovery.”
Related Stories
| Sep 10, 2013
BUILDINGChicago eShow Daily – Day 2 coverage
The BD+C editorial team brings you this real-time coverage of day 2 of the BUILDINGChicago/Greening the Heartland conference and expo taking place this week at the Holiday Inn Chicago Mart Plaza.
| Sep 9, 2013
Top 25 continuing education courses on BDCuniversity
An overview of the 25 most popular continuing education courses on BDCuniversity.com.
| Sep 6, 2013
Public Architecture's Day Labor Station: Just the type of 'great idea' we're looking for in the $5,000 Vision U40 competition
Thinking about competing in BD+C's Vision U40 program at next month's U40 Leadership Summit? Here's a good example of the kind of "great idea" we're looking for.
| Sep 6, 2013
U40 Summit featured speaker: Arthur Gensler on how to build a world-class AEC practice
Gensler, founder of the world’s largest architecture firm, will talk about the role of the architect in society, the impact of great design, and the practicalities of starting and running a practice, and will offer advice for today’s young design and construction professionals.
| Sep 6, 2013
CertainTeed announces roofing contractor program partnership with Angie’s List
By teaming with Angie’s List, CertainTeed is helping local contractors build awareness for their services by providing access to exclusive advertising discounts, local business growth marketing opportunities and support.
| Sep 4, 2013
Augmented reality: 12 applications for design and construction professionals
Building Design+Construction reached out to AEC professionals who have studied and applied augmented reality and asked them to pinpoint applications that are ripe for the technology. Here’s what they had to offer.
| Sep 4, 2013
Augmented reality goes mainstream: 12 applications for design and construction firms
Thanks to inexpensive mobile devices and increasingly advanced software apps, Building Teams are finally able to bring their BIM models to life on the job site.
| Sep 4, 2013
K-12 school design that pays off for students
More and more educators are being influenced by the Reggio Emilia approach to pedagogy, with its mantra of “environment as the third teacher”—an approach that gives Building Teams a responsibility to pay even closer attention to the special needs of today’s schools.
| Sep 4, 2013
Smart building technology: Talking results at the BUILDINGChicago/ Greening the Heartland show
Recent advancements in technology are allowing owners to connect with facilities as never before, leveraging existing automation systems to achieve cost-effective energy improvements. This BUILDINGChicago presentation will feature Procter & Gamble’s smart building management program.
| Sep 4, 2013
Last chance to pre-register for BUILDINGChicago/Greening the Heartland Conference at 20% savings
Attendees of the BUILDINGChicago/Greening the Heartland Expo and Conference can still save 20% off the at-site registration fee by registering online in these final days before the event opens on September 9 and concludes on September 11.
