US Nonresidential Construction Spending Reaches Record High in February

Associated Builder and Contractors (ABC), a national construction industry trade association with more than 23,000 members, reported on Tuesday that according to its analysis of the US Census Bureau’s construction spending report, nonresidential construction spending increased 0.3% in February. On a seasonally adjusted annual basis, spending totaled $1.255 trillion.

ABC noted that spending was up on a monthly basis in 9 of the 16 nonresidential subcategories. Private nonresidential spending increased 0.4%, while public nonresidential construction spending was up 0.2%.

Commenting on the report, ABC Chief Economist Anirban Basu said:

“Nonresidential spending rebounded in February, rising to the highest level on record. A surge in highway and street spending accounted for more than 40% of the monthly increase, and public sector nonresidential spending is now up more than 6% on a year-over-year basis. Unfortunately, private sector spending has not kept pace and is up just 2.5% since last February, a rate of increase slower than economywide inflation.

The mix of high interest rates, tight lending standards and unprecedented uncertainty regarding trade policy will continue to weigh on private sector construction in the coming months. Despite these ongoing headwinds and the expectation that materials prices will rise as tariffs are implemented, contractors remain optimistic about their prospects over the next six months, according to ABC’s Construction Confidence Index.”