ConDig (01-Nov-23) Construction spending in the US beat estimates and rose 0.4% higher in September to a seasonally adjusted annual rate of $1,996.5 billion compared with a revised August estimate of $1,988.3 billion, according latest figures from the U.S. Census Bureau.

The September figure was also 8.7% above last September’s estimate of $1,836.9 billion.

It comes as spending on private construction was at a seasonally adjusted annual rate of $1,555.9 billion, 0.4% above the revised August estimate of $1,549.6 billion. 

Residential construction was at a seasonally adjusted annual rate of $872.0 billion in September, 0.6% above the revised August estimate of $866.6 billion. 

Nonresidential construction was at a seasonally adjusted annual rate of $683.9 billion in September, 0.1% above the revised August estimate of $683 billion.

“Nonresidential construction spending increased for the 16th straight month in September,” said Associated Builders and Contractors chief economist Anirban Basu. “While some private categories, including power, commercial and amusement and recreation saw healthy month-over-month increases, publicly financed construction accounted for more than 72% of September’s rise. Given increased federal infrastructure spending and exorbitant financing costs for private construction, that dynamic should remain firmly in place over the coming months.”

“Despite a small decrease in spending in September, manufacturing construction remains the nonresidential sector’s outperformer,” added Basu. “Spending in the category is up 62% over the past year and accounts for nearly 43% of the year-over-year increase in nonresidential construction put in place. With several industrial megaprojects ongoing, spending in the manufacturing segment will remain elevated for several quarters.”

In September, the estimated seasonally adjusted annual rate of public construction spending was $440.6 billion, 0.4% above the revised August estimate of $438.7 billion. Educational construction was at a seasonally adjusted annual rate of $94.4 billion, 1.9% above the revised August estimate of $92.7 billion. Highway construction was at a seasonally adjusted annual rate of $131.1 billion, 0.2% below the revised August estimate of $131.4 billion.