{"id":26685,"date":"2025-05-29T13:26:06","date_gmt":"2025-05-29T17:26:06","guid":{"rendered":"https:\/\/www.construction.com\/?post_type=blog&#038;p=26685"},"modified":"2025-05-29T13:28:46","modified_gmt":"2025-05-29T17:28:46","slug":"construction-spending-drops-below-expectations-in-march","status":"publish","type":"blog","link":"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/","title":{"rendered":"Construction Spending Drops Below Expectations in March"},"content":{"rendered":"<p><em>by Arsene Aka, Senior Economist at Dodge Construction Network<\/em><\/p>\n<p><span data-contrast=\"auto\">Economic uncertainty, tariffs, and the high-interest-rate environment may\u00a0have contributed to lower construction spending in March. According to the U.S. Commerce Department (Census Bureau), the total value of construction put in place declined 0.5% in March to a seasonally adjusted annual rate of $2.2 trillion. Spending on both residential and nonresidential construction projects fell in March. Economists had expected a modest increase in total construction spending that month.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Spending on residential construction (including renovations) slipped 0.4% in March. New single-family construction outlays posted a meager 0.1% improvement, the fourth consecutive increase. Meanwhile, spending on new multi-family construction was flat. The residential construction sector has been constrained by stubbornly high mortgage rates, tighter immigration policies, and the latest tariffs on imported goods. The National Association of Home Builders estimated in April that tariffs could add $10,900 per home.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">On the other hand, spending on nonresidential construction decreased 0.5% in March, as 11 of the 16 nonresidential construction sectors posted monthly declines. Outlays on religious construction posted the largest decline, followed by spending on healthcare and lodging. Meanwhile, spending on public safety, amusement, transportation, conservation, and water construction projects rose in March. Of note, data center construction outlays remained a bright spot, with spending up 33% year-over-year, down from 39% in the previous month, as AI-driven demand for computing power remained strong. Spending on data centers has seen double-digit year-over-year increases in each month since November 2021.\u00a0\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">In the opening quarter of this year, construction spending stood at $486 billion on an unadjusted basis, up 3% from the first quarter of 2024. Residential construction outlays grew 3%, to $207 billion, and nonresidential construction also rose 3% to $278 billion. <\/span><a href=\"https:\/\/www.construction.com\/\"><span data-contrast=\"none\">Dodge Construction Network<\/span><\/a> <span data-contrast=\"auto\">expects modest to moderate growth in the total value of construction put in place over the next two years. Dodge expects three 25 bps interest rate cuts by the Federal Reserve this year, followed by an additional 25 bps cut every quarter in 2026, which will help support construction spending and starts. That said, trade policy uncertainties will lead to extremely cautious investment behavior by construction firms.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-26686\" src=\"https:\/\/www.construction.com\/wp-content\/uploads\/2025\/05\/March-Construction-Spending-300x180.png\" alt=\"March Construction Spending\" width=\"503\" height=\"302\" srcset=\"https:\/\/www.construction.com\/wp-content\/uploads\/2025\/05\/March-Construction-Spending-300x180.png 300w, https:\/\/www.construction.com\/wp-content\/uploads\/2025\/05\/March-Construction-Spending.png 480w\" sizes=\"auto, (max-width: 503px) 100vw, 503px\" \/><\/p>\n","protected":false},"featured_media":26686,"template":"","class_list":["post-26685","blog","type-blog","status-publish","has-post-thumbnail","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Construction Spending Drops Below Expectations in March | Dodge Construction Network<\/title>\n<meta name=\"description\" content=\"Economic uncertainty, tariffs, and the high-interest-rate environment may\u00a0have contributed to lower construction spending in March. According to the U.S. Commerce Department (Census Bureau), the total value of construction put in place declined 0.5% in March to a seasonally adjusted annual rate of $2.2 trillion.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Construction Spending Drops Below Expectations in March | Dodge Construction Network\" \/>\n<meta property=\"og:description\" content=\"Economic uncertainty, tariffs, and the high-interest-rate environment may\u00a0have contributed to lower construction spending in March. According to the U.S. Commerce Department (Census Bureau), the total value of construction put in place declined 0.5% in March to a seasonally adjusted annual rate of $2.2 trillion.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/\" \/>\n<meta property=\"og:site_name\" content=\"Dodge Construction Network\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/DodgeData\" \/>\n<meta property=\"article:modified_time\" content=\"2025-05-29T17:28:46+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.construction.com\/wp-content\/uploads\/2025\/05\/March-Construction-Spending.png\" \/>\n\t<meta property=\"og:image:width\" content=\"480\" \/>\n\t<meta property=\"og:image:height\" content=\"288\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:site\" content=\"@DodgeData\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/\",\"url\":\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/\",\"name\":\"Construction Spending Drops Below Expectations in March | Dodge Construction Network\",\"isPartOf\":{\"@id\":\"https:\/\/www.construction.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.construction.com\/blog\/construction-spending-drops-below-expectations-in-march\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.construction.com\/wp-content\/uploads\/2025\/05\/March-Construction-Spending.png\",\"datePublished\":\"2025-05-29T17:26:06+00:00\",\"dateModified\":\"2025-05-29T17:28:46+00:00\",\"description\":\"Economic uncertainty, tariffs, and the high-interest-rate environment may\u00a0have contributed to lower construction spending in March. 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According to the U.S. Commerce Department (Census Bureau), the total value of construction put in place declined 0.5% in March to a seasonally adjusted annual rate of $2.2 trillion. Spending on...","_links":{"self":[{"href":"https:\/\/www.construction.com\/wp-json\/wp\/v2\/blog\/26685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.construction.com\/wp-json\/wp\/v2\/blog"}],"about":[{"href":"https:\/\/www.construction.com\/wp-json\/wp\/v2\/types\/blog"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.construction.com\/wp-json\/wp\/v2\/media\/26686"}],"wp:attachment":[{"href":"https:\/\/www.construction.com\/wp-json\/wp\/v2\/media?parent=26685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}