Nonresidential construction spending decreased 0.2% from July to August and is down 1.6% compared with August 2024, according to Associated Builders and Contractors.
For public construction, spending was down 0.1% for the month and is up 2.4% year to date. Private nonresidential spending decreased 0.3% from July to August and is down 4% year to date. Spending was down for the month in 10 of the 16 nonresidential subcategories.
“Nonresidential construction spending contracted for the third time in the past four months in August and is now down 1.5% year over year,” said ABC Chief Economist Anirban Basu. “The manufacturing and commercial categories have been particularly weak in 2025, while momentum remains confined almost exclusively to the data center segment. This should come as no surprise given that approximately 1 in 7 ABC members are under contract to work on a data center, and those contractors have significantly higher backlog than those that are not, according to ABC’s Construction Backlog Indicator survey.
“Of course, this data pertains to August and reflects neither the effects of the government shutdown nor the cost-raising potential of tariffs that were implemented at the start of that month,” Basu continues. “With private nonresidential activity buckling under the weight of high borrowing costs, extraordinarily elevated uncertainty and rising materials costs, a slowdown in public sector work could lead to a particularly difficult few quarters for the industry.”
