Market Intel Update: U.S. Economy Contracts in Q1 2025, GDP Shrinks by 0.3%

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.

The seasonally adjusted annual rate of $2.20 trillion for March 2025 represents a monthly decline of -0.5%. Due to revisions, this is the first month-over-month decline since September, 2024. Compared to March 2024, the total represents a 2.8% increase year over year.

Both Public and Private construction saw month-over-month decreases of -0.2% and -0.6% respectively.

Source: US Census Value of Construction Put in Place Survey May 1, 2025 release

This decrease in growth is consistent with other economic data released recently. Advanced estimates for 2025 Q1 GDP show contraction with a -0.3% real growth rate in GDP.

The overall decline in topline growth masks the underlying variance of sector-specific growth. Factors such as higher-for-longer interest rates, changes in fiscal policy, trade uncertainty and other economic conditions account for this variability. The residential market declined -0.4% month over month while the nonresidential market declined -0.5%.

Source: US Census Value of Construction Put in Place Survey May 1, 2025 release

With respect to year-to-date growth in individual markets, 2025 continues a shift away from sectors that previously lead growth and new sectors emerging. The Water sector continues to grow in both Supply and Sewage & Waste Disposal, while growth in Amusement & Recreation & Transportation remains strong.

For the sectors in decline, Commercial continues to see declines due to interest rate sensitivity and other secular trends affecting demand, while Highway & Street and Health Care continue to see decline. The last time these sectors had sustained low-to-negative growth was early 2021.