AGC: Nonresidential construction down in November, Homebuilding up

Construction spending was a tale of two industries again in November, as soaring single-family construction masked ongoing downturns in private and public nonresidential construction, according to an analysis of new federal construction spending data by the Associated General Contractors of America. Association officials said the new figures underscore the need for new infrastructure investments and other measures to boost demand for nonresidential construction amid the pandemic.

Construction spending in November totaled $1.46 trillion at a seasonally adjusted annual rate, an increase of 0.9 percent from the pace in October and 3.8 percent higher than in November 2019. But the gains were limited to residential construction, which soared 2.6 percent for the month and 16.2 percent year-over-year. Meanwhile, private and public nonresidential spending slumped 0.6 percent from October and 4.7 percent from a year earlier.

Private nonresidential construction spending decreased for the fifth month in a row, sliding 0.8 percent from October to November and 9.5 percent from November 2019. The largest private nonresidential segment, power construction, declined 0.9 percent for the month. Among the other large private nonresidential project types, commercial construction—comprising retail, warehouse and farm structures—dipped 0.3 percent for the month, manufacturing construction inched up 0.1 percent, office construction gained 0.3 percent, and healthcare construction fell 1.4 percent.

Public construction spending declined 0.2 percent for the month but increased 3.1 percent year-over-year. There were decreases from October to November for most nonresidential categories, although the two largest segments rose: highway and street construction gained 1.8 percent for the month, while educational construction increased 0.3 percent.

Private residential construction spending increased for the sixth consecutive month, rising 2.7 percent in November. Single-family homebuilding jumped 5.1 percent for the month, while residential improvements spending ticked up 0.2 percent. Multifamily construction spending was flat.

 

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