Construction Spending Falls in March, Further Slowdown Expected
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Residential and non-residential spending both fell in March.
Data courtesy U.S. Census Bureau
Total construction spending fell 0.5% month-over-month in March, according to a report recently released by the U.S. Census Bureau. Residential construction spending fell 0.4% from February’s rates, while non-residential spending declined 0.5%.
“Nonresidential construction spending fell sharply in March, with declines spread across virtually every private subsector,” Anirban Basu, chief economist at Associated Builders and Contractors, commented in a press release. “Given unprecedented economic uncertainty, spending is unlikely to rebound in the coming months.”
Religious and health care construction spending experienced the sharpest declines in March, at 2.9% and 1.8%, respectively. The transportation sector saw one of the few spending increases, at 1.2%, while public safety rose 0.7%. On a yearly basis, overall spending rose 2.8%, the lowest increase since 2019, said Ken Simonson, chief economist at the Associated General Contractors of America.
“Construction spending retreated in March, as media reports and corporate announcements suggest owners are hesitant to start new projects in light of uncertainty over tariffs, government funding, and other policy upheavals,” Simonson said in a statement. “Spending has slowed over the past year and as current projects wind down, there may be several months of declining construction activity.”
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