Source: Associated Builders and Contractors
National nonresidential construction spending fell 0.1 percent in March and is up 2.0 percent compared to the same time last year, according to an Associated Builders and Contractors analysis of data published by the U.S. Census Bureau. On a seasonally adjusted annualized basis, spending totaled $802.6B for the month.
Among 16 nonresidential subcategories, 12 experienced a decline in spending on a monthly basis. Private nonresidential spending fell 1.3 percent from February, while public nonresidential construction spending increased 1.6 percent.
“Today’s data release answers precious few questions,” said ABC Chief Economist Anirban Basu. “The great debate has been whether the combination of pre-existing backlog as reported in ABC’s Construction Backlog Indicator and the classification of construction as an essential activity in much of the nation would help shield the sector from the downturn. Based on March construction spending data, industry activity largely proceeded apace, with recessionary forces impeding broader industry activity to only a limited extent.”
“However, the data are inconclusive,” said Basu. “Economically, the pandemic impacted only a portion of March. Moreover, March represented only the tip of the iceberg in terms of the economic impact of COVID-19, as April was far worse. Many general contractors are in the midst of discussions with developers and other consumers of construction services regarding potential project postponements and cancellations. While the health of public finances held up in March, they collapsed in April as governors, mayors, county executives and others began to observe large gaps in budgets. According to ABC’s Construction Confidence Index, confidence in sales, profit margins and staffing levels plummeted in late March. This strongly implies that pre-existing backlog may not be as potent a defensive mechanism as it typically is during the early stages of an economic downturn.”
“Furthermore, there have been anecdotal reports of construction projects shutting down temporarily due to lingering concerns about the need for aggressive social distancing and associated worker availability challenges,” said Basu. “All of this suggests that the March spending data may be supplying a false sense of industry-wide stability. Data characterizing construction spending in April and May will be far more instructive.”
NEWS TICKER
- [May 30, 2025] - Phoenix Wants Multifamily Mixed-Use at 19th & Dunlap Light Rail
- [May 30, 2025] - Senior/Assisted Living Center Proposed in Maricopa
- [May 30, 2025] - Scottsdale Establishes Transportation & Infrastructure Department
- [May 30, 2025] - Arizona Projects 05-30-25
- [May 28, 2025] - Split Vote Complicates Plans for VAI Resort
- [May 28, 2025] - Safford Approves 165-Unit Multifamily Development
- [May 27, 2025] - JDM Proposal Reimagines Biltmore Infill Project
- [May 27, 2025] - $500M Whiteriver Hospital Preparations Advancing