Dodge Data & Analytics, New York, has reported construction starts rose 48% in July largely because of the start of three large manufacturing plants and two liquefied natural gas export facilities. However, total construction starts still would have increased 7% without these larger projects.
“Mega-projects aside, construction continues to improve despite the pressure created by higher interest rates and labor scarcity,” said Richard Branch, chief economist for Dodge Construction Network. “Combined with the strong labor market, this is another indicator that the U.S. is not currently in a recession. However, the Federal Reserve will continue to aggressively raise interest rates until they feel that inflation is under control. This will create mounting pressure on building activity and potentially lead to a slowdown in construction starts by year-end.”
Nonresidential building construction surged 79% in July as manufacturing starts jumped, institutional starts rose 28% and commercial construction dropped 11%.
Residential building construction fell 8% in July. Multifamily starts fell 5%, and single-family housing declined 9%.
Nonbuilding construction jumped 120% in July.
For the 12 months ending in July, nonresidential building was up 21% compared with the 12 months ending July 2021. Residential building rose 4%, and nonbuilding construction increased 10%.
