National nonresidential construction spending increased 0.4 percent in August, according to an Associated Builders and Contractors (ABC) analysis of data published by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.09 trillion.
Spending was up on a monthly basis in 12 of the 16 nonresidential subcategories. Private nonresidential spending increased by 0.3 percent, while public nonresidential construction spending was up 0.6 percent in August.
“Aggregate nonresidential construction spending expanded at a respectable rate in August,” says ABC chief economist Anirban Basu. “But manufacturing-related and public sector projects accounted for more than 100 percent of the monthly increase. Privately financed commercial- and educational-related construction spending declined by almost 1 percent at least partially due to elevated borrowing costs.
“Despite high interest rates and ongoing weakness in certain segments like office and retail, contractors remain relatively upbeat,” says Basu. “Despite still-high materials costs and ongoing labor shortages, a plurality of contractors expect their profit margins to increase over the next six months, according to ABC’s Construction Confidence Index.”
