Nonresidential Construction Spending Rises to Highest Level on Record in February

National nonresidential construction spending increased 0.3% in February, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.255 trillion.

Spending was up on a monthly basis in 9 of the 16 nonresidential subcategories. Private nonresidential spending increased 0.4%, while public nonresidential construction spending was up 0.2% in February.

“Nonresidential spending rebounded in February, rising to the highest level on record,” said ABC Chief Economist Anirban Basu. “A surge in highway and street spending accounted for more than 40% of the monthly increase, and public sector nonresidential spending is now up more than 6% on a year-over-year basis. Unfortunately, private sector spending has not kept pace and is up just 2.5% since last February, a rate of increase slower than economywide inflation.

“The mix of high interest rates, tight lending standards and unprecedented uncertainty regarding trade policy will continue to weigh on private sector construction in the coming months,” said Basu. “Despite these ongoing headwinds and the expectation that materials prices will rise as tariffs are implemented, contractors remain optimistic about their prospects over the next six months, according to ABC’s Construction Confidence Index.”