U.S. Census Bureau
665f5fe6a2596cc4f5ce1f13 Spending Graph 6

Nonresidential Spending Down, But Still High

June 4, 2024
Spending in April slipped slightly, but remained well above its level a year ago, according to new government data.


WASHINGTON, June 3—Nonresidential construction spending decreased 0.3% in April, according to new data from the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.2 trillion, still well above where it was a year ago.

Spending was down on a monthly basis in 10 of the 16 nonresidential subcategories. Private nonresidential spending decreased 0.3%, while public nonresidential construction spending was down 0.2% in April.

“Overall spending slipped despite upturns in manufacturing and power construction and a slight pickup in single-family homebuilding,” said Ken Simonson, chief economist for the Associated General Contractors of America. “Most public segments continued a seesaw pattern, with decreases in April following gains in other recent months.”

Still, the total for April is "just 0.3% below the all-time high established in February,” noted Anirban Basu, chief economist for the Associated Builders and Contractors trade group. “An unprecedented increase in manufacturing construction spending has pushed overall nonresidential activity 31.9% higher over the past two years."

Ongoing investment in industrial facilities as well as significant infrastructure-related outlays will keep nonresidential spending elevated despite current expectations that interest rates will stay higher for longer, he added. "This outlook is reflected in ABC’s Construction Confidence Index, which shows that a majority of contractors expect their sales to increase over the next two quarters,” said Basu.

Construction spending, not adjusted for inflation, totaled $2.099 trillion at a seasonally adjusted annual rate in April. That figure is 0.1% below the upwardly revised March rate, but 10% above the April 2023 level.

Spending on private nonresidential projects declined 0.3% on balance in April but rose 8.3% year-over-year. The largest private segment, manufacturing construction, climbed 0.9% for the month and 17.1% over 12 months. Commercial construction fell 1.1% in April and was virtually unchanged from a year earlier. Investment in power, oil, and gas projects edged up 0.1% in April and rose 7.4% year-over-year.

Spending on private residential construction ticked up 0.1% for the month and 8.0% year-over-year. Single-family construction rose for the 12th month in a row, by 0.1%, and 20.4% year-over-year. Multifamily spending fell 0.3% in April but climbed 2.3% from April 2023.

Public construction spending fell 0.3% for the month but rose 16.7% from a year earlier. The largest public segment, highway and street construction, fell 0.5% in April but rose 16.4% over 12 months. Public educational spending fell 0.2% in April but rose 16.8% over the year.