US construction spending slips in February

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That’s according to the Associated General Contractors of America (AGC), which has analysed the latest official figures.

Total construction spending declined from January to February to an annual rate of nearly $2.1 trillion but all categories posted year-over-year gains, according to the AGC.

There were monthly decreases for nearly all types of non-residential projects but that could have been down to heavy rain and snow in the west during February.

“Every spending segment increased from a year earlier, suggesting the current downturns may reflect short-term challenges such as severe weather, not fading demand,” said AGC’s chief economist Ken Simonson.

Construction spending, not adjusted for inflation, totaled $2.1 trillion at a seasonally adjusted annual rate in February. That figure is 0.3% below the downwardly revised January rate, but 10.7% above the February 2023 level.

Spending on private non-residential construction decreased 0.9% in February but rose 12.6% from February 2023. Manufacturing construction slid 0.6% for the month but jumped 31.8% year on year. Commercial construction dropped 1.7% in February but ticked up 0.9% over 12 months. Investment in power, oil, and gas projects declined 0.5% for the month but rose 6.9% year-over-year.

Public construction spending decreased 1.2% for the month but soared 16.8% from a year earlier. The largest public segment, highway and street construction, fell by 1.6% in February but was up 18.5% from February 2023. Public educational spending was down 1.8% from January but climbed 15.4% year on year.

Spending on private residential construction gained 0.7% for the month and 6.3% year on year. Single-family construction climbed 1.4% from January, the tenth-straight increase. Spending on multifamily projects dipped 0.2% in February but remained 6.1% higher than a year earlier.

While it hailed the year-on-year growth in construction as good news, the AGC warned that many firms continue to struggle to find enough workers to hire.

It urged federal, state, and local officials to boost funding for construction education and training programs to help encourage more people to seek construction careers.

Jeffrey D. Shoaf, the AGC’s chief executive said, “It is in the public interest to make sure there are enough people available to keep pace with growing investments in infrastructure, manufacturing and clean energy.

“Investing in new construction education and training programs and creating a workable legal immigration process for skilled construction workers will help get key projects completed and provide another path to middle class prosperity for many workers.”