Public Projects Fuel Construction Spending Growth
Date Posted: November 2, 2023
Posted In: Discussion, News, Projects,
From Construction Dive: National nonresidential construction spending inched higher by 0.3% in September to a seasonally adjusted annualized basis of $1.1 trillion, according to a new Associated Builders and Contractors analysis.
After a revision flipped May’s 0.2% drop to a 0.9% gain, September’s jump now indicates the 16th consecutive month of expansion, primarily due to publicly financed construction, said Anirban Basu, ABC chief economist.
“While some private categories, including power, commercial and amusement and recreation saw healthy month-over-month increases, publicly financed construction accounted for more than 72% of September’s rise,” said Basu. “Given increased federal infrastructure spending and exorbitant financing costs for private construction, that dynamic should remain firmly in place over the coming months.”
Dive Insights
The largest nonresidential segments showed mixed results from August to September, according to the Associated General Contractors of America construction spending report.
Commercial construction, which includes warehouse and retail projects, increased 0.7% in September, noted the AGC report. Meanwhile, investment in power, oil and gas projects climbed 0.9%, while spending on education projects also increased 1.8%.
But manufacturing-related spending dipped 0.4%, while highway and street spending also inched lower by 0.1%, according to the AGC report.