Nonresidential construction spending dipped 0.2% nationwide in June, according to the latest Associated Builders and Contractors analysis of data published by the U.S. Census Bureau. 

On a seasonally adjusted annualized basis, nonresidential spending totaled $1.21 trillion, with nonresidential construction expanding 5.3% from a year ago. Spending decreased on a monthly basis in 7 of the 16 nonresidential subcategories. Private nonresidential spending fell 0.1% in June, while public nonresidential construction spending was down 0.4%. 

“A new trend in nonresidential construction is emerging, and it’s not a good thing,” said ABC Chief Economist Anirban Basu. “Despite a bevy of megaprojects in certain parts of the nation, overall nonresidential construction spending appears to have entered a period of stagnation. The flattening of momentum has been apparent for the better part of a year, but the impact of higher interest rates, tighter credit conditions, and a softening economy is increasingly apparent in the most recent data, which indicate that aggregate nonresidential construction spending is in decline.”

“Despite a recent loss in spending growth momentum, many contractors remain upbeat, according to ABC’s Construction Confidence Index, anticipating growth in revenues and payrolls over the next six months,” added Basu. “But with interest rates staying higher for longer, it appears that many projects are being put on hold, limiting construction starts, suppressing backlog, and perhaps eventually eroding current contractor confidence.”

The association's June analysis of construction input price data can also be found here.