Nonresidential construction spending was unchanged in May and is down 3.8% compared with May 2025, according to Associated Builders and Contractors.
For public construction, spending was up 0.4% for the month and is up 0.3% year to date. Private nonresidential spending decreased 0.3% in May and 6.6% year to date. Spending was up for the month in 11 of the 16 nonresidential subcategories.
“Private nonresidential construction spending shrank for the seventh consecutive month in May and is now down 6.6% on a year-over-year basis,” said ABC Chief Economist Anirban Basu. “This weakness is largely due to the ongoing decline in manufacturing-related construction spending as CHIPS Act-supported projects wind down, yet overall there are few sources of momentum in the segment.
“Yes, the amusement and recreation category continues to grow at a healthy pace, and the religious category has rebounded meaningfully over the past year,” Basu continued. “But those modestly sized segments are far too small to carry the broader nonresidential market, especially given the weakness in larger categories. For instance, warehouse construction spending, which appeared to stabilize at the start of 2026, has now fallen for three consecutive months and is down 8.5% year over year, while the general office category remains in a state of freefall, down 11.9% since May 2025."
Basu said data center construction continues to drive momentum.
"For now, momentum remains largely concentrated in the data center segment," Basu said. "As seen in ABC's most recent Construction Backlog Indicator release, those fortunate enough to have data center work have significantly longer backlogs (11.6 months) than those who do not (8.6 months)."
