New construction starts moved 5% lower in September to a seasonally adjusted annual rate of $774.1 billion, according to Dodge Data & Analytics. This marks the second consecutive monthly decline in construction starts. By major sector, nonbuilding construction fell 13% in September, while residential construction dropped 6%. On the plus side, nonresidential construction starts rose 1% during the month, aided by the start of a large manufacturing project.

Through the first nine months of 2019, total construction starts were 3% lower than 2018 due to pullbacks in both residential and nonresidential construction starts. However, nonbuilding construction starts are 4% higher year-to-date as a result of strong gains in electric utilities/gas plants.

“Large projects continue to make their presence felt in the monthly statistics, sometimes obscuring underlying trends,” says Richard Branch, chief economist for Dodge Data & Analytics. “Nevertheless, construction starts have certainly throttled back in 2019 due to mounting uncertainty over the country’s economic health.”

Nonresidential building starts inched 1% higher in September to $287 billion (at a seasonally adjusted annual rate). The increase was a result of 243% growth in manufacturing construction due to the start of a large automotive plant. Commercial construction starts fell 14% over the month as the office sector pulled back from a very strong level of activity during the prior month. Institutional construction starts fell 1%.

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