Nonresidential Construction Spending Flat in April
Key Highlights
- Nonresidential construction spending increased by 0.1% in April, totaling $1.250 trillion on a seasonally adjusted basis;
- Public sector construction saw a 0.4% rise, whereas private nonresidential spending declined by 0.2%, marking the seventh consecutive monthly decrease;
- Data center projects grew by 1.9% in April, contributing yet again to a generally positive outlook and buoying contractor confidence;
- But rising materials prices and lack of growth in many commercial segments may soon challenge contractor sentiment.
WASHINGTON, June 1 — National nonresidential construction spending increased 0.1% in April, according to an Associated Builders and Contractors (ABC) analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.250 trillion.
Spending was up on a monthly basis in 10 of the 16 nonresidential subcategories. Private nonresidential spending was down 0.2%, while public nonresidential construction spending was up 0.4% in April.
Spending on data centers, which is included in the office category, increased another 1.9% in April, rising to a seasonally adjusted annual rate of $50.7 billion, up 28.1% over the past year.
“Nonresidential construction spending inched higher in April, but that growth was entirely due to a sizable increase in public sector activity,” said ABC Chief Economist Anirban Basu. “Private nonresidential construction spending fell for the seventh consecutive month and is down nearly 8% from December 2023’s all-time high. While much of the segment’s recent weakness is attributable to the rapid decline in CHIPS Act-incentivized manufacturing megaprojects, private sector construction momentum has been difficult to find outside of the still-ascendant data center segment.
“Those data center projects have buoyed the ABC Construction Backlog Indicator and kept ABC members confident about their outlooks, at least on the whole,” said Basu. “While that particular tailwind will persist for some time, rising materials prices and a lack of momentum in many commercial segments may eventually weigh on contractor sentiment.”
Contact: Erika Walter, ABC | [email protected]
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Associated Builders and Contractors is a national construction industry trade association established in 1950 with 67 chapters and 24,000 members. Founded on the merit shop philosophy, ABC helps members offer a robust employee value proposition, develop people, win work and deliver that work safely, ethically and profitably for the betterment of the communities in which ABC and its members work.