ARLINGTON, VA.—U.S. construction spending increased in January compared to both December and a year ago, with strong gains in private nonresidential and residential construction but mixed results for public spending, according to an analysis of federal spending data the Associated General Contractors of America released recently.
“Private nonresidential construction, especially for manufacturing plants, has rebounded sharply in recent months, while demand for housing remains strong,” said Ken Simonson, the association’s chief economist, in a March 1 statement. “But public projects have yet to grow consistently.”
Construction spending in January totalled $1.68 trillion at a seasonally adjusted annual rate, 1.3 per cent above the upwardly revised December rate and 8.2 per cent higher than in January 2021. Private residential construction spending rose 1.3 per cent in January from a month prior and 13.4 per cent from January 2021, while private nonresidential construction spending increased 1.8 per cent from December to January and 7.3 per cent from January 2021.
In contrast, public construction spending rose 0.6 per cent for the month but slipped 1.3 per cent from the year-ago level.
Among residential segments, single-family construction added 1.2 per cent over the December total and 15.4 per cent year-over-year. Multifamily construction inched down less than 0.1 per cent in January but rose 4.8 per cent from a year earlier. Spending on improvements to existing owner-occupied houses increased 1.8 per cent for the month and 13.7 per cent year-over-year.
A surge in manufacturing construction, which gained 8.5 per cent for the month and 31.2 per cent year-over-year, accounted for the bulk of the private nonresidential pickup. In addition, the largest private nonresidential segment, power construction, rose 2.7 per cent for the month but trailed the January 2021 rate by 1.4 per cent.
The next-largest segment, commercial construction, declined 0.5 per cent in January but jumped 18.0 per cent year-over-year, with year-over-year gains in each component: warehouses (up 22.4 per cent), retail categories (up 15.2 per cent) and farm (up 4.4 per cent).
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