Nonresidential construction spending has now declined during each of the year’s first three months, according to a May 1 report by the U.S. Census Bureau. In March, nonresidential construction spending fell 0.1 percent on a monthly basis, though the pace of spending is still 4.7 percent higher than at the same time one year ago. Spending for the month totaled $611.8 billion on a seasonally adjusted, annualized basis. Spending estimates for both January and February were upwardly revised—the estimate for February construction spending rose from $611.5 billion to $612.4 billion and January’s estimate was revised from $611.9 to $613.1.
“Up until six months ago, the U.S. economy was manifesting surging momentum, but the last six months have been disappointing.” said Associated Builders and Contractors Chief Economist Anirban Basu. “The recovery’s momentum has slowed to a crawl. Lower energy prices and their impact on investment spending, a stronger U.S. dollar, weather, and the West Coast port slowdown have all conspired to undo the economic momentum apparent during mid-year 2014. However, there is little reason for despair. Last year also got off to a hobbled start, but the economy still managed to expand 2.4 percent in 2014. This year can still be better, including for nonresidential construction.”
Seven of 16 nonresidential construction subsectors posted increases in spending in March on a monthly basis.
- Manufacturing-related construction spending expanded 3 percent in March and is up 50.3 percent for the year.
- Office-related construction spending expanded 2.2 percent in March and is up 19.8 percent from the same time one year ago.
- Construction spending in the transportation category grew 1 percent on a monthly basis and has expanded 9.2 percent on an annual basis.
- Lodging-related construction spending was up 5.2 percent on a monthly basis and 22 percent on a year-over-year basis.
- Health care-related construction spending expanded 0.2 percent for the month, but is down 0.2 percent for the year.
- Spending in the water supply category expanded 4 percent from February and is up 2.3 on an annual basis.
- Communication-related construction spending expanded 12.3 percent for the month and is down 8.5 percent for the year.
Spending in nine nonresidential construction subsectors failed to rise in March.
- Public safety-related construction spending slipped 2.8 percent on a monthly basis and is down 9.1 percent on a year-over-year basis.
- Commercial construction spending was down 2.2 percent in March, but is up 12.8 percent on a year-over-year basis.
- Religious spending fell 5.1 percent for the month and is down 17.6 percent from the same time last year.
- Sewage and waste disposal-related construction spending shed 0.2 percent for the month, but has grown 19.6 percent on a 12-month basis.
- Power-related construction spending fell 4.5 percent for the month and is 17.2 percent lower than at the same time one year ago.
- Highway and street-related construction spending fell 2.4 percent in March and is down 5.3 percent compared to the same time last year.
- Conservation and development-related construction spending fell 11.4 percent for the month, but is up 12.3 percent on a yearly basis.
- Amusement and recreation-related construction spending fell 3 percent on a monthly basis, but is up 23.8 percent from the same time last year.
- Education-related construction spending fell 1.8 percent for the month and is down 3 percent on a year-over-year basis.