Construction Put in Place Update

Recently, the US Census released the results of its monthly Value of Construction Put in Place Survey. The survey provides estimates of the total dollar value of construction work done in the U.S. This data includes design and construction spending for public and private projects.  

With an estimate of $1.983 trillion for the month of August 2023, this is the 8th consecutive month where construction spending rose, beginning in December 2022. 

Total Construction spending growth continues to be strong. Nominal values are still at all-time highs with 7.4% annual growth (seasonally adjusted). 

• Month-over-month growth is 0.5%, a slight decrease from last month’s 0.7%. 
• Spending growth continues to vary by project classification, with Private Residential spending seeing largest year-over-year declines (-3.0%) and Private Manufacturing growth at 65.1% year over year.  

• Spending on Public construction projects is significantly higher year-to-date at 12.8% compared to the same time last year. Private construction came in at just 2.0% over the same period. 

Nonresidential spending continues to have larger share of total construction spending since it surpassed residential spending in September 2022, though it is plateauing. 

• Nonresidential project classifications grew at 17.6% year over year, a decrease from last month’s 19.8%. 
• Total nonresidential saw a slight uptick in month-over-month growth at 0.4% compared to the previous 2 months of 0.1% growth. 

Residential spending continues upward growth from April 2023 low. 

• -3.0% year-over-year growth in the latest survey is a significant improvement from last month’s reading of -9.6%. 
• This marks the fourth consecutive reading of positive month-over-month growth, coming in this time at 0.6%. 

We can point to fiscal policy and subsequent private investment in sectors like manufacturing, transportation and wastewater as supporting these high growth levels, while the residential sector rebounds slightly.