Construction Spending Rose Slightly in March

Construction spending rose slightly in March, bolstered by nonresidential private construction while new single-family residential construction remains in a slump. 

Overall, construction spending rose 0.3% in March after dropping by the same amount in February, according to data from the U.S. Census Bureau.

Residential Spending Concerns Persist, But Multifamily Spending Up

Private and public residential construction spending decreased by 0.2%, down 9.8% year-over-year. 

Private residential construction saw a slight 0.3% increase over March after dropping 0.6% in February, while nonresidential private construction picked up by 1.0%.

Amid concerns over high mortgage rates, supply costs and uncertainty about inflation, new single-family construction remained slumped in March. New single-family construction fell 0.8% in March and was down 22.9% year-over-year.

New multifamily construction saw a slight increase in the wake of the nation’s uncertain housing market, increasing 0.4% in March, up 23% year-over-year, further cementing the demand for rental housing. 

Private Lodging, Education Spending Jumps

Among private construction projects, nonresidential spending increased overall by 1.0% and is up 21.3% year-over-year. Lodging and office construction both saw 0.3% increases in spending, while health care spending rose 0.6% and educational construction spending jumped 1.5%. 

Commercial construction also dipped 0.8% in March, but is up 20.1% year-over-year. 

Public Construction Rose Moderately

Overall public construction spending increased 0.2% in March, up 15% from March 2022. Office construction spending decreased 1.4% in March, while health care construction spending dropped 2.3%.