Public Sector Lifts Nonresidential Construction Spending in April
According to Construction Executive, national nonresidential construction spending increased 0.1% in April to a seasonally adjusted annualized rate of $1.250 trillion, based on an Associated Builders and Contractors analysis of U.S. Census Bureau data. Public nonresidential spending rose 0.4% while private nonresidential fell 0.2%, its seventh consecutive monthly decline. Spending increased in 10 of 16 nonresidential subcategories. Data center construction stood out, climbing 1.9% in April to a $50.7 billion annual rate and up 28.1% over the past year.
What It Means for Subcontractors
- Public sector work is the bright spot right now. Subs with relationships in government, transportation, and infrastructure are better positioned than those relying on private commercial pipelines.
- Private nonresidential is down nearly 8% from its December 2023 peak, per ABC Chief Economist Anirban Basu. Subs should expect continued softness on the private side when bidding or forecasting backlogs.
- Data center work remains a strong outlier. Electrical, mechanical, and civil subs with data center experience are seeing one of the healthiest niches in the current market.
