Dodge: Construction Starts Drop 6% as Fewer Megaprojects Move Forward
All three major sectors declined in September with residential leading the tumble.
Total construction starts fell 6% in September to a seasonally adjusted annual rate of $1.2 trillion, according to Dodge Construction Network. Nonresidential starts lost 4%, residential starts declined 6%, and nonbuilding starts fell 9%.
Year-to-date through September 2023, total construction starts were 3% below that of 2022. Residential and nonresidential starts were down 17% and 7%, respectively; however, nonbuilding starts were up 25% on a year-to-date basis.
For the 12 months ending September 2023, total construction starts were unchanged. Nonbuilding starts were 22% higher, and nonresidential building starts gained 3%. Conversely, on a 12-month rolling basis, residential starts posted a 16% decline.
"Risks continue to mount for the construction sector," said Richard Branch, chief economist for Dodge Construction Network. "Over the last 12 months, construction starts have essentially froze as rates increased and credit tightened. The industry needs further adjusting as rates are expected to stay higher for longer, along with the potential for higher energy costs and continued political uncertainty. A return to broad-based growth in construction starts is still some time away."
Nonbuilding
Nonbuilding construction starts decreased in September, falling 9% to a seasonally adjusted annual rate of $345 billion. Highway and bridge starts lost 15% and environmental public works starts fell 29%.
Not all sectors fell, however: miscellaneous nonbuilding starts rose 4%, and utility/gas plant starts gained 14%.
Year-to-date through September, nonbuilding starts were up 25%. Utility/gas plants rose 58%, and miscellaneous nonbuilding starts were up 23%.
Highway and bridge starts gained 13%, and environmental public works rose 16%.
For the past 12 months ending in September 2023, total nonbuilding starts were 22% higher than that of September 2022.
Utility/gas plant and miscellaneous nonbuilding starts rose 35% and 22%, respectively. Highway and bridge starts, in addition to environmental public works starts, were both up 18% on a 12-month rolling sum basis.
Nonresidential
Nonresidential building starts fell 4% in September to a seasonally adjusted annual rate of $459 billion. Commercial starts rose 6% due to strength in data center work (classified as an office structure in the Dodge database) and retail.
lnstitutional starts fell 8% in September despite a healthy gain in education starts, and manufacturing starts declined 13%.
On a year-to-date basis through September, total nonresidential starts were 7% lower than that of 2022.
lnstitutional starts gained 5%, while commercial and manufacturing starts fell 6% and 31%, respectively.
For the past 12 months ending in September 2023, total nonresidential building starts were 3% higher than that ending September 2022. Manufacturing starts were 8% lower. lnstitutional starts improved by 8%, and commercial starts gained 4%.
Residential
Residential building starts fell 6% tn September to a seasonally adjusted annual rate of $394 billion. Single family starts gained 1%,while multifamily starts lost 17%.
On a year-to-date basis through September 2023, total residential starts were down 17%.
Single family starts were 19% lower, and multifamily starts were down 12%.
For the past 12 months ending in September 2023, residential starts were 16% lower than in 2022. Single family starts were 22% lower, while multifamily starts were down 5% on a rolling 12-month basis.
Regionally, total construction starts in September fell in the Northeast, Midwest, South Atlantic and West regions, but rose modestly in the South Central.
Learn more at www.construction.com
CONTRACTOR SUPPLY MAGAZINE
The October/November 2024 of Contractor Supply magazine is here!
Our cover story, A Rewarding Passion - Dale Hahs II, third-generation of Denver's AIS Industrial & Construction Supply, is STAFDA's incoming 2025 president.
A Special STAFDA section featuring a welcome address, an agenda, session previewss by presenters and much more. Also in this issue are our Industry Updates on: Lifting, Moving and Material Handling; Lasers, Levels and Measurement; Hand Tools; Cordless Power Tools; Drill Bits and Cutting Tools; and Toolboxes, Bags and Belts.
This digital edition, sponsored by BECK AMERICA Inc., is fully searchable and contains live links to every advertiser and new product listing. Click away!
| Read the Articles Read the Digital Edition |
