Catalyst Construction Economics Hub
Know where the industry is.Know where it's headed.
Data Which Reflects Where the Industry Is Today
Construction Spending
U.S. Census Bureau - Construction Spending
Year-To-Date Annual Total - Seasonally Adjusted Annual Rate
February 2025 vs. February 2024
All Construction Spending: +2.9%
Public Construction: +6.0%
Private Construction: +2.0%
Residential Construction: +1.6%
Non-Residential Construction: +3.9%
Quick Analysis:
Spending growth continues to cool, which is not surprising given the past two years of architects reporting less projects in the design phase. That said, each major sector is still reporting spending growth versus the prior year which is positive for the overall industry. On the whole, macro economic factors appear to be dragging on new construction activity, which is in turn putting pressure on year-over-year spending growth in the private segment.
Notable Increases/Decreases By Type:
- Water Supply - Spending is up 15.9% versus 2024
- Manufacturing - Spending is up 4.8% versus 2024
- Commercial - Spending is down 3.0% versus 2024
- New Multifamily - Spending is down 11.6% versus 2024
https://www.census.gov/construction/c30/c30index.html
Construction Costs
ENR Construction Cost Index
April 2025 vs. April 2024
Total Construction Costs: +2.0%
Building Cost Index: +1.9%
Material Cost Index: - 0.9%
Skilled Labor Costs: +4.4%
Common Labor Costs: +3.1%
Quick Analysis:
Construction input cost fluctuations in both major buckets - materials and labor - have remained fairly stable recently. It is interesting to note that ENR's Material Cost Index reflects an almost 1% decrease in overall material input costs versus a year ago. This dynamic surrounding materials is unlikely to persist given the uncertainty posed by tariffs.
http://enr.construction.com/economics/
Construction Employment
U.S. Bureau of Labor Statistics
March 2025
Construction Unemployment: 5.4%
Quick Analysis:
The industry's unemployment rate of 5.4% for the month of March remains largely in line with the industry's unemployment rate for the month versus the prior three years. The U.S. construction industry's unemployment rate has shown seasonal variations but generally remains low, reflecting a tight labor market.
http://data.bls.gov/timeseries/LNU04032231?data_tool=XGtable
Contractor Backlogs
ABC Backlog Indicator
March 2025 (1st Quarter)
National Avg. Backlog: 8.5 months
Backlog By Region:
South: 10.3 months | Northeast: 8.0 months | Middle States: 7.4 months | West: 7.4 months
Backlog By Company Revenue:
<$30 Million: 7.4 months | $30-$50 Million : 9.6 months | $50-$100 Million: 9.0 months | >$100 Million: 12.9 months
Backlog By Industry:
Commercial & Institutional: 8.7 months | Heavy Industrial: 7.4 months | Infrastructure: 9.5 months
Quick Analysis:
The Associated Builders and Contractors' latest survey indicates that recent tariffs are significantly impacting the U.S. construction industry. Approximately 80% of contractors reported supplier notifications of tariff-induced material price increases, and nearly 20% experienced project delays or interruptions due to these tariffs. While the Construction Backlog Indicator rose to 8.5 months in March, contractor confidence has declined, with fewer than 26% expecting profit margin growth over the next six months and over 40% anticipating contractions, especially among those surveyed after the April 2 tariff announcement.
http://www.abc.org/NewsMedia/ConstructionEconomics/ConstructionBacklogIndicator/
Data Which Reflects Where the Industry Is Headed
Architectural Billings
AIA Architectural Billings Index
March 2025
Architectural Billings Index (ABI): 44.1
New Design Contract Index (DCI): 42.4
Commercial/Industrial ABI: 45.1
Institutional ABI: 46.2
Multi-Family Residential ABI: 40.3
Mixed Practice ABI: 46.1
South Region ABI: 48.3
West Region ABI: 43.0
Midwest Region ABI: 45.5
Northeast Region ABI: 40.5
New Project Inquiry Index (NPII): 47.7
Quick Analysis:
Index value > 50 represents that architects have reported more activity for that particular metric than the prior month. These metrics are leading indicators as the ABI reflects projects in design that will enter the construction phase in 9 to 12 months and the NPII reflects new project demand from owners to potentially enter the design phase.
In March 2025, the AIA's Architecture Billings Index (ABI) recorded a score of 44.1, indicating continued declining billings at architecture firms. This month represents the second consecutive monthly decrease in project inquiries - which had not decreased on a monthly basis since 2020, reflecting ongoing economic uncertainty. Additionally, the value of newly signed design contracts declined for the thirteenth consecutive month, as clients remain hesitant to commit to new projects. To summarize, demand for new projects appears to be weakening due to macroeconomic concerns from project owners.
http://new.aia.org/press-releases
