For the first time in months, private nonresidential construction is seeing an increase, according to the most recent statistics released by the Associated General Contractors of America.
The marginal improvement was seen in January, which registered a 0.9% nonresidential construction gain over the preceding month.
At the same time, the buoyant residential market saw a 2.5% increase from December to January.
Looking at the numbers from a yearly perspective, residential construction was up by a 21% over early 2020, while much less active nonresidential spending was down by 5% over January of last year.
In a statement on the most recent findings, Ken Simonson, chief economist with the AGC, noted that despite January’s upward numbers, “spending on private nonresidential construction remained at the second-lowest level in more than three years.”
In fact, continued Simonson, all eleven of the private nonresidential categories surveyed by the Census Bureau were down compared to early 2020.
The power construction segment, the largest private nonresidential segment surveyed, saw a 0.8% drop from December and a significantly larger 10% decline from where it was in January 2020.
Commercial construction, taking in farm structures, retail, and warehouses, were down by 1.8% from December to January, with a larger 8.3% over the year.
Although analysts have predicted that the office construction segment would register a great drop due to the simple fact that the Covid-19 outbreak has decreased demand for new offices, that segment was only marginally down 0.2% between December and January, with a 4.4% decrease compared to last January.
Public construction, meanwhile, has remained a bright spot, with a 1.7% increase from December to January, and stronger 2.9% jump over the year.
In the public category, highway construction saw a strong 5.8% increase In January, and 6.5% jump from early 2020. The AGC report speculates that the highway numbers may be reflective of “unseasonably mild weather conditions in January 2021, compared to December and January 2020.”
By Garry Boulard
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