Construction spending increased in most building sectors relevant to the glass and glazing industry, according to the latest report from the U.S. Census Bureau.

The value of construction put in place, at a seasonally adjusted annual rate, in nonresidential construction edged up 0.1 percent from January to February and 1.3 percent from February 2017. The increases were due in part to strength in the lodging and office segments.

Lodging construction increased 3.2 percent for the month and 15.2 percent for the year, while office was up 5.5 percent and 4.1 percent by the same measures, respectively. The other “commercial” category, which includes retail, wholesale and some service-related buildings, also performed well, with a half-percent increase month-over-month and an 8.3-percent bump year-over-year.

On the institutional side of construction spending, educational building continued its steady ascent with a 0.7-percent increase from the prior month. It is also up 2.7 percent from the same time last year. Meanwhile, healthcare building pulled back 4.9 percent on a monthly basis, though it is still up 4.3 percent from the same time last year.

[For further analysis, read the latest on the KMR Research blog–February Nonresidential Spending: What’s Actually Relevant to Glass and Glazing?]

Associated Builders and Contractors chief economist Anirban Basu said in his analysis that nonresidential spending growth remains tepid because of capacity constraints and the ongoing skilled labor shortage, as well as rising interest rates and borrowing costs.

“Concerns regarding rising materials prices are also becoming more intense, particularly in light of the recent enactment of tariffs on steel and aluminum and growing fears of a trade war and materials shortages,” he said. “Softwood lumber prices, which have been impacted by an ongoing trade dispute with Canada, were up nearly 16 percent over a recent 12-month period. On top of all of this is sporadic growth in public construction spending as government monies continue to be siphoned away to finance underfunded pensions, Medicaid and other public priorities.”

Most private nonresidential categories, as well as new single- and multifamily construction, increased, which is a positive sign for the glass and glazing industry. Private construction as a whole was up 0.7 percent for the month and 3.4 percent for the year. Less importantly, public construction spending decreased 2.1 percent on a monthly basis, though it is up 1.6 percent from the same time last year. Public spending has been dragged down by sectors not relevant to the glass industry, such as highway and street, sewage and waste disposal, and conservation and development.

“Construction spending in February was marked by healthy gains in most private categories but a widespread and steep downturn in public construction,” said Ken Simonson chief economist of the Associated General Contractors of America. “Year-over-year trends suggest overall expansion, but public investment will depend on how quickly federal agencies follow up on the spending that Congress has authorized.”