This audio is automatically generated. Please let us know if you have any comments.
Dive Brief:
- Non-residential construction spending fell 0.2% in March, according to an analysis of U.S. Census Bureau data on Associated Builders and Contractors.
- Both public and private non-residential spending fell 0.2 percent month-on-month in March, including declines in nine of 16 non-residential subcategories, the report said.
- The continued slowdown in spending, initially concentrated in manufacturing tasks, has begun to affect other sectors. “While much of the ongoing decline is due to the ongoing decline in manufacturing-related construction activity, the weakness is becoming more widespread,” ABC chief economist Anirban Basu said in the statement.
Diving knowledge:
The decline now extends to both public and private construction activity, according to ABC. Private construction, in particular, has fallen more than 2 percent year-on-year, Basu said.
“With the exception of the ongoing boom in data center construction, there are few sources of momentum,” Basu said.
Spending on manufacturing projects fell 1.1% month-on-month in March and fell 17% over the past year. Spending on highway and street construction also fell, down 0.2% month-on-month in March, the data showed. Global business spending also fell by 0.2% over the same period.
But the slowdown elsewhere has not affected pace of data center constructionthe report notes. In fact, data center construction spending increased 34.3% year over year, according to Basu. Many contractors in the space expect this activity level to continue
“Despite this continued weakness, however, contractors remain optimistic about the outlook,” Basu said.
Projects related to data centers, such as the electrical sectoralso posted strong numbers, said Macrina Wilkins, director of market information for the Associated General Contractors of America. Electrical construction spending increased 4.6% from March 2025, according to the AGC report.
“Construction growth remains concentrated in a narrow set of categories,” Wilkins said. “Investment linked to data centers and energy projects continues to support activity, but several traditional non-residential segments, including manufacturing and commercial construction, continue to lag.”
