Data Centers Drive July Growth in US Nonresidential Construction Spending
Key Highlights
- Nonresidential construction spending increased by 0.1% in July, driven mainly by data centers
- Private nonresidential spending rose 0.4%, while public spending declined 0.2%
- Contractor confidence remains high, but optimism is increasingly dependent on the data and power sectors
WASHINGTON, DC — Data published September 1 by the US Census Bureau shows that national, nonresidential construction spending increased 0.1% in July.
Spending was down on a monthly basis in 8 of the 16 nonresidential subcategories. Private nonresidential construction spending was up 0.4%, while public nonresidential spending was down 0.2% in July.
On a seasonally adjusted, annualized basis, nonresidential spending totaled $1.286 trillion.
Nonresidential Activity Concentrates in Data, Power Generation
“The increase in nonresidential construction spending that occurred in July was entirely due to data centers,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Excluding that booming category, nonresidential spending fell for the second straight month and is down to the lowest level since September 2023.
“Nonresidential activity is even more concentrated given that the power category, which has been boosted by the electricity needs of data centers, has also grown substantially over the past year,” said Basu. “While contractors remain upbeat about their sales over the next six months, according to ABC’s Construction Confidence Index, that upbeat outlook is increasingly dependent on a single sector.”
Visit abc.org/economics for the Construction Backlog Indicator and Construction Confidence Index, plus analysis of spending, employment, job openings and the Producer Price Index.