February 2025 Construction Spending Update

Nonresidential construction spending was flat for Q4 2024, while residential spending rebounded from a relatively slow summer.
- Note: The 2024 residential summer slowdown was far less severe than 2023.
Now that we have full-year data for 2024, we can compare it to 2023. Key observations:
- The growth of the overall US economy slowed in 2024, with GDP expanding by 2.5% vs. growth of 3.2% in 2023.
- At the macro level, both residential construction spending (up 6.1%) and nonresidential (up 3.0%) were positive.
- Residential spending was similar in 2023 (up 6.8%) and consisted of growth in both single and multi-family. In 2024, growth was based on single-family and remodeling, while multi-family declined significantly.
- Nonresidential had 3% annual growth in 2024, well below the 20% growth rate of 2023. 2023 growth was driven by a 60% increase in manufacturing spending along with solid growth in public spending on roads, water/wastewater, and public safety. Although high growth rates ceased, historically high spending levels continued across many of these market sectors.