Data Centers Drive Growth as Office, Warehouse Spending Sinks
According to Construction Dive, private nonresidential construction spending dropped 0.3% month over month in May and is down 6.6% over the past year, per ABC’s analysis of Census Bureau data. Data center work remains the exception, with contractors in that niche carrying backlogs averaging 11.6 months. Warehouse spending fell 8.5% year over year and office construction is down 11.9% since May 2025. Public spending, including highway work, held up better, and AGC economist Ken Simonson urged Congress to renew the highway bill before it expires September 30.
What It Means for Subcontractors
- Electrical, mechanical, and cooling specialists should prioritize data center pipelines, where backlogs run months longer than elsewhere.
- Firms tied to warehouse or office fit-out work may need to diversify into public infrastructure projects like highways and water systems to offset private-sector softness.
- Watch the September 30 highway bill deadline closely. Its renewal could sustain one of the few reliable growth segments for road, bridge, and civil subcontractors.
