Nonresidential Construction Spending Up Again in September
Key Highlights
- Nonresidential construction spending increased for the sixth consecutive month;
- Data center spending rose 8.6% in September, rising at a whopping 217% yearly rate since May;
- Excluding data centers and related power projects, nonresidential spending declined in September.
WASHINGTON, Nov. 2 — National nonresidential construction spending increased 0.6% in September, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.325 trillion.
Spending was up on a monthly basis in 8 of the 16 nonresidential subcategories. Private nonresidential spending was up 1.1%, while public nonresidential construction spending was down 0.1% in September.
“Nonresidential construction spending grew for the sixth consecutive month in September,” said ABC Chief Economist Anirban Basu. “As has been the case for several months, data centers accounted for virtually all of that increase. Excluding data centers and the closely related power category, nonresidential spending actually fell in September. It’s increasingly difficult to contextualize the speed of the data center boom; spending in the category jumped another 8.6% in September and has grown at a 217% annualized rate since May.
“Given the recent rise in treasury yields and ongoing materials price escalation, momentum will remain narrowly concentrated in artificial intelligence-related segments over the next several months,” said Basu. “While contractors remain busy in the aggregate, according to ABC’s Construction Backlog Indicator, current market dynamics will continue to favor larger contractors who are far more likely to be involved in data center and power projects.”
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Visit abc.org/economics for the Construction Backlog Indicator and Construction Confidence Index, plus analysis of spending, employment, job openings and the Producer Price Index.
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. Visit us at abc.org.
