Nonresidential U.S. construction spending fell 0.5% in June, says ABC

Quarry Products / August 2, 2022
By Guy Woodford
Building works in New York. Pic: Sibel Aisha

National nonresidential construction spending was down by 0.5% in June, according to an Associated Builders and Contractors (ABC) analysis of data published by the U.S. Census Bureau. On a seasonally adjusted annualised basis, nonresidential spending totalled $829.4 billion for the month.

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Nonresidential construction spending was down 0.5% in June, says ABC after analysing U.S. Census Bureau data


Spending was down on a monthly basis in eight of the 16 nonresidential subcategories. Both private and public nonresidential spending fell by 0.5% in June.

U.S. Census Bureau June 2022 data
On a seasonally adjusted annualised basis, nonresidential spending totalled $829.4 billion in June 2022


“There continues to be significant downward pressure on nonresidential construction spending volumes, and that is likely to intensify going forward,” said ABC Chief Economist Anirban Basu. “To date, construction spending measured in dollars has been propped up by elevated construction delivery costs, including higher materials prices and rapidly rising wages. Despite those inflationary pressures, aggregate nonresidential construction spending has failed to recover to pre-pandemic levels in nominal terms. The situation looks even worse when adjusting for inflation.

Nonresidential spending in $
U.S. nonresidential construction spending in billion dollars June 2015 - June 2022


“The primary issue is that those high construction delivery charges are inducing a significant fraction of project owners to reconsider start dates,” said Basu. “True, backlog remains elevated, according to ABC’s Construction Backlog Indicator, but this may be because it is taking longer to complete projects. Additional project delays and cancellations are likely as borrowing costs continue to ratchet higher for those who purchase construction services and as the risk of recession increases. For now, many contractors remain busy and continue to operate at or near capacity. Whether that will continue for another 12 to 18 months remains an unanswered question.”