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% on a monthly basis, though the pace of spending is still 4.7% 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% 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% in March and is up 50.3% for the year.
• Office-related construction spending expanded 2.2% in March and is up 19.8% from the same time one year ago.
• Construction spending in the transportation category grew 1% on a monthly basis and has expanded 9.2% on an annual basis.
• Lodging-related construction spending was up 5.2% on a monthly basis and 22% on a year-over-year basis.
• Health care-related construction spending expanded 0.2% for the month, but is down 0.2% for the year.
• Spending in the water supply category expanded 4% from February and is up 2.3 on an annual basis.
• Communication-related construction spending expanded 12.3% for the month and is down 8.5% for the year.
Spending in nine nonresidential construction subsectors failed to rise in March.
• Public safety-related construction spending slipped 2.8% on a monthly basis and is down 9.1% on a year-over-year basis.
• Commercial construction spending was down 2.2% in March, but is up 12.8% on a year-over-year basis.
• Religious spending fell 5.1% for the month and is down 17.6% from the same time last year.
• Sewage and waste disposal-related construction spending shed 0.2% for the month, but has grown 19.6% 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.
• Highway and street-related construction spending fell 2.4% in March and is down 5.3% compared to the same time last year.
• Conservation and development-related construction spending fell 11.4% for the month, but is up 12.3% on a yearly basis.
• Amusement and recreation-related construction spending fell 3% on a monthly basis but is up 23.8% from the same time last year.
• Education-related construction spending fell 1.8% for the month and is down 3% on a year-over-year basis.