ConDig (03-March-20) Construction spending rose 1.8% in January compared with the month prior to $1.369 trillion amid rises in all major segments of the market on strong economic conditions, according to latest US Census Bureau figures.

The total was also 6.8% higher than the same period last year and was underpinned by unusually mild winter weather in much of the country.

But construction analysts warned that spending in future months could be impacted by uncertainty related to the coronavirus and its potential impacts on the supply chain for construction materials. 

“While overall economic conditions remain favorable, future construction spending levels may be affected by the growing uncertainties related to the coronavirus and its impact on the supply chain for construction components, especially those manufactured in hard-hit countries,” said Ken Simonson, chief economist at the Associated General Contractors of America.

Simonson noted that many construction materials, machines and parts are sourced, at least in part, from China and other countries where production and transportation have been disrupted by the virus. 

But he added that no contractors had yet to report supply problems that are impacting their projects.   

Public construction spending increased 2.6% from December and 12.6% from a year earlier. The largest public category, highway and street construction, increased 11.7%. 

Public spending on transportation infrastructure—airports, transit, rail and ports—climbed 11.5%. Private residential spending increased 2.1% for the month, led by a 2.8% increase in single-family homebuilding. Multifamily construction remained flat.