Nonresidential construction spending down in December 2021

By |  February 1, 2022


National nonresidential construction spending fell 0.7 percent in December, according to an Associated Builders & Contractors (ABC) analysis of U.S. Census Bureau data.

Seasonally adjusted, nonresidential spending totaled $820.7 billion for the month.

Spending fell in December in 11 of 16 nonresidential subcategories. Private nonresidential spending was virtually unchanged, but public nonresidential construction spending declined 1.6 percent during the month.

Overall nonresidential construction spending was up 3.9 percent from a year ago. Residential construction spending rose 14.7 percent in that time.

“Much of the increase in nonresidential construction spending is attributable to inflationary pressures, not actual increases in physical output,” says Anirban Basu, ABC’s chief economist. “The fact that nonresidential spending was down in December despite rising labor costs and elevated materials prices does not bode well for near-term profitability.

According to Basu, certain segments continue to create a disproportionate share of contractor opportunities.

“Among those are the commercial segment, which includes construction of fulfillment centers and manufacturing, a segment in which construction spending has expanded more than 30 percent during the past year,” Basu says. “Residential construction also continues to be a hot spot in an environment characterized by scant inventory of unsold homes and rapidly rising rents, and the strength of multifamily construction is arguably one of the most surprising aspects of the economic recovery.”

Nonetheless, Basu says contractors remain confident about the next six months, according to ABC’s Construction Confidence Index.

“Public construction was responsible for much of the weakness in December,” he says. “The expectation among many is that, as infrastructure monies begin to flow, the second half of the year will be better than the first. It is possible that infrastructure dollars will not begin to forcefully affect the marketplace until 2023. Time will tell.”

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About the Author:

Jack Kopanski is the Managing Editor of Pit & Quarry and Editor-in-Chief of Portable Plants. Kopanski can be reached at 216-706-3756 or

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