Economy

February construction spending steady, shows solid y/y improvement

April 2, 2024

US construction spending in February was mostly steady from January but showed significant gains from last year.

The US Census Bureau estimated total construction spending during the month to be $2.0915 trillion at a seasonally adjusted annual rate (SAAR). While comparable to January’s revised spending estimate of $2.097 trillion, this was a rise of nearly 11% from February 2023.

Construction spending amounted to $298.1 billion in the first two months of the year – 12% ahead of the same period in 2023.

February spending on private nonresidential projects reached a SAAR of $716 billion. While a decline of 0.9% from the month prior, it was nearly 13% higher year over year (y/y).

The largest segments within private nonresidential spending showed similar patterns, according to the Associated General Contractors (AGC) of America. While down 0.6% month on month (m/m), manufacturing construction jumped 32% y/y. Commercial construction was down 1.7% m/m but ticked up 1% y/y. Power, oil, and gas project spending dropped 0.5% m/m while rising 7% y/y.

“There were monthly decreases for nearly all types of nonresidential projects,” pointed out Ken Simonson, chief economist at the Associated General Contractors (AGC) of America.

“But every spending segment increased from a year earlier, suggesting the current downturns may reflect short-term challenges such as severe weather, not fading demand,” he noted.

In February, private residential construction spending inched up 0.7% m/m to a SAAR of $901.1 billion.

Spending on public construction projects was 1.2% higher m/m with a February SAAR of $474.4 billion.

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. Since 2007, she has held various editorial and marketing positions with steel industry publications, associations, and mills. In 2021, after a five-year hiatus working across other industries, she returned to steel trade journalism, joining SMU in 2022. She is a member of the Association of Women in the Metal Industries and a past-president of the AWMI Pittsburgh Chapter. She holds a BA in Latin American Studies from Edinboro University of Pennsylvania. She can be reached at laura@steelmarketupdate.com or 724-759-7869.