Construction Spending Declines in April

“Bad though these numbers are, construction spending appears sure to shrink further,” said AGC Chief Economist Ken Simonson. “In our latest survey, 40 percent of contractors report that an upcoming project has been canceled. But this is a great time to undertake needed infrastructure projects, with more availability of labor, lower materials costs and record-low borrowing costs for many public agencies.”

Simonson noted that 10 out of 12 public and 10 out of 11 private nonresidential construction categories declined from March to April. He added that highway and street construction tumbled by an especially steep amount, 5.2 percent.

“Although there have been scattered reports of acceleration in highway spending, many state and local transportation departments have been postponing or canceling projects as fuel-tax and toll revenues plummet,” Simonson said. “The highway construction downturn is likely to intensify in future months because, in many states, April is normally the first month of significant highway spending following winter shutdowns.”