Construction Spending Falls on a Monthly Basis in July, Census Bureau Reports

(Image courtesy of U.S. Census Bureau; Breakout image courtesy of Burst/pexels.com)

Construction spending in July was estimated at a seasonally adjusted annual rate of $2,162.7 billion, 0.3% below the revised June estimate, but 6.7% above the July 2023 estimate, the U.S. Census Bureau reported.

From January to July so far, construction spending has amounted to $1,237.5 billion, 8.8% above the same time period in 2023.

“The monthly drop was owed to a pull-back in both residential and nonresidential outlays. Although total spending is still up 6.7% over the past year, construction activity is losing momentum as elevated financing costs narrows the pipeline of new projects getting started. Lower interest rates should eventually help bring about a turnaround, however ongoing weakness in the forward-looking Architecture Billings Index (ABI) suggests a material recovery is still off in the distance,” wrote Wells Fargo Economists Charlie Dougherty, Jackie Benson and Ali Hajibeigi in an analysis.

Spending on private construction was at a seasonally adjusted annual rate of $1,678.7 billion, 0.4% below the revised June estimate.

Private residential construction was at a seasonally adjusted annual rate of $941.6 billion in July, 0.4% below the revised June estimate. Private nonresidential construction was at a seasonally adjusted annual rate of $737.2 billion in July, also 0.4% below the revised June estimate.

The estimated seasonally adjusted annual rate of public construction spending was $484 billion, 0.1% above the revised June estimate.

Educational construction was at a seasonally adjusted annual rate of $100.8 billion, 0.9% below the revised June estimate of $101.8 billion.

The August 2024 construction spending report will be released Oct. 1.