Construction Starts Pull back 10% in July

US construction starts experienced a significant 10.2% contraction in July, reaching a seasonally adjusted annual rate of $1.19 trillion and reversing June's strong showing. Dodge Construction Network reported this decline was largely due to a sharp 30.1% fall in nonresidential building starts, compounded by a 3.1% dip in residential activity. However, year-to-date through July, overall starts show a modest 1.6% increase on last year, supported by resilient nonbuilding (+5.3%) and nonresidential (+4.3%) sectors. Residential starts remain a drag, down 4.4% over the same period. Chief Economist Eric Gaus highlighted persistent sectoral divergence: single-family housing and manufacturing continue to struggle, contrasting with a burgeoning data centre market. Nonbuilding work, particularly utilities, surged 20.4% in July, bolstered by major offshore wind and infrastructure projects. The nonresidential decline stemmed from a post-surge plunge in manufacturing and normalising office activity. Regional variations, with gains in the Northeast against declines elsewhere, underscore a nuanced sector outlook. Read More