Dodge Data & Analytics, New York, has reported construction starts fell 8% in February after climbing 1% in January.
Nonresidential building construction fell 16% in February as manufacturing starts dropped 28%. Commercial starts fell 3%, and institutional starts fell 19% as the education and transportation sectors faltered.
Residential building construction fell 2% in February. Single-family housing rose 5%, and multifamily starts declined 12%.
Nonbuilding construction decreased 3% in February.
For the 12 months ending in February, total construction starts were up 2% compared with the 12 months ending February 2023. Nonbuilding construction grew 19%; nonresidential building fell 2%; and residential building dropped 4%.
“Construction activity was hit hard by higher rates and more restrictive credit standards,” said Richard Branch, chief economist for Dodge Construction Network. “Starts struggled over the past several months as the lagged effect of higher rates impacted projects moving forward through the planning process. Additionally, the significant deficit of skilled labor led to further delays—especially in the manufacturing sector. While optimism should prevail in the second half of the year as the Federal Reserve begins to cut rates, some sectors, like commercial, will make little headway over the remainder of the year.”
