In July, nonresidential construction spending declined 0.2% to an annual rate of $1.21 trillion, according to Associated Builders and Contractors (ABC). This marks the second consecutive monthly decrease, though the level remains close to the all-time high set in May. The drop is attributed to high interest rates and disruptions from Hurricane Beryl.
Labor shortages and macroeconomic challenges continue to affect the construction sector. About 94% of firms with hourly craft worker openings report difficulty filling positions, reflecting a worsening worker shortage.
Spending in 11 of 16 nonresidential subcategories fell, with private nonresidential spending down 0.4%, while public nonresidential spending increased slightly by 0.2%. Contractors are cautious about future growth, with less than half expecting increased sales, awaiting potential interest rate cuts from the Federal Reserve in September.
In July, nonresidential construction spending fell by 0.2% to an annual rate of $1.21 trillion, marking the second consecutive monthly decline but remaining near the record high set in May. This decrease is attributed to high interest rates and disruptions from Hurricane Beryl. Labor shortages persist, with 94% of firms struggling to fill hourly craft worker positions, reflecting ongoing worker shortages. Spending decreased in 11 of 16 nonresidential subcategories, with private nonresidential spending down 0.4% and public nonresidential spending up slightly by 0.2%. Contractors are cautious about future growth, anticipating potential interest rate cuts by the Federal Reserve in September.
