Construction activity moderated in August, falling 24.8%, according to Dodge Construction Network (DCN). Nonresidential building declined 32% over the month, while residential starts decreased 5.2%.
On a year-to-date basis, total construction starts were up 15.2% through August. Nonresidential starts were up 23.4%, and residential starts were down 1.8%. For the 12 months ending August 2026, total construction starts were up 14.5% from the 12 months ending August 2025. Residential starts were down 2.4%, while nonresidential starts were up 17.9%.
“After a pop in activity last month, construction starts largely normalized throughout August,” says Sarah Martin, DCN’s director of economic research. “Abstracting from the month-to-month volatility, the story remains consistent. Data center, semiconductor and energy construction are driving growth, while several other sectors are facing subdued activity alongside deeper labor shortages and accelerating material prices.”
Regionally, total construction starts in August fell in every region except the South Central (28.8%); the Northeast (-52.6%), the Midwest (-1.1%), the South Atlantic (-24.2%) and the West (-51.4%) all saw declines.
Nonresidential
Commercial starts fell 37.6% in August. Hotel construction surged 302.2% after a weak July, and retail stores improved by 26.9%. All other commercial sectors faced declines in August, including offices and data centers (-31.3%) and warehouses. Institutional starts also slowed, sliding back 18.1% in August, driven by weaker education starts and miscellaneous institutional starts (-39.1%).
On a year-to-date basis through August, nonresidential starts were up 23.4%. Commercial and industrial construction gained 47.7%, while institutional starts were down 3.9% over the same period. For the 12 months ending August 2026, total nonresidential starts were up 17.9% compared to the 12 months ending August 2025. Commercial starts were up 48.6%, institutional starts decreased 4.3%, and manufacturing starts were up 2.8% over the same period.
Residential
Single-family starts remained flat in August, growing 0.4%, while multifamily starts declined by 13.5%. On a year-to-date basis, residential starts were down 1.8%, with single-family starts down 4.6% and multifamily starts up 3%.
For the 12 months ending August 2026, total residential starts fell 2.4%. Single-family starts declined 8.6% compared to the 12 months ending August 2025, and multifamily starts increased 8.7% over the same period.