Construction Spending Rises in December

According to the U.S. Census Bureau, construction spending during December 2024 was estimated at a seasonally adjusted annual rate of $2,192.2 billion, 0.5% (± 0.8%) above the revised November estimate of $2,180.3 billion. The December figure is 4.3% (±1.3%) above the December 2023 estimate of $2,101.3 billion.

The value of construction in 2024 was $2,154.4 billion, 6.5% (±1.0%) above the $2,023.7 billion spent in 2023.

In December, the estimated seasonally adjusted annual rate of public construction spending was $503.6 billion, 0.5% (±1.6%) below the revised November estimate of $506.2 billion.

  • Highway construction was at a seasonally adjusted annual rate of $143.3 billion, 0.7% (±3.5%) above the revised November estimate of $142.3 billion.
  • Educational construction was at a seasonally adjusted annual rate of $109.5 billion, 0.6% (±2.0%) below the revised November estimate of $110.2 billion.

The value of public construction in 2024 was $492.7 billion, 9.3% (±2.0%) above the $450.7 billion spent in 2023. Educational construction in 2024 was $105.2 billion, 8.5% (±4.1%) above the 2023 figure of $97.0 billion and highway construction was $142.7 billion, 4.1% (±4.4%) above the $137.0 billion in 2023.

Spending on private construction was at a seasonally adjusted annual rate of $1,688.5 billion, 0.9% (±0.5%) above the revised November estimate of $1,674.1 billion.

  • Residential construction was at a seasonally adjusted annual rate of $939.5 billion in December, 1.5% (±1.3%) above the revised November estimate of $925.5 billion.
  • Nonresidential construction was at a seasonally adjusted annual rate of $749.0 billion in December, 0.1% (±0.5%) above the revised November estimate of $748.6 billion.

The value of private construction in 2024 was $1,661.7 billion, 5.6% (±1.2%) above the $1,573.0 billion spent in 2023. Residential construction in 2024 was $917.9 billion, 5.9% (±2.1%) above the 2023 figure of $866.9 billion and nonresidential construction was $743.8 billion, 5.3% (±1.2%) above the $706.1 billion in 2023.

“Despite declines in a few segments, construction demand remains relatively strong,” said Jeffrey Shoaf, the chief executive officer of the Associated General Contractors of America (AGC). “But increasing the cost of a range of construction materials will prompt contractors to raise bid prices, potentially undermining future demand for projects.”

Association officials noted that the recently released AGC of America/Sage 2025 Construction Hiring & Business Outlook revealed that potential tariffs and their impacts on materials prices were among firms’ top four concerns in 2025. Any tariffs that are ultimately put in place with trading partners, including Mexico and Canada, are likely to increase the costs of construction and harm construction employers who are forced to absorb cost increases because they are locked in contracts, sometimes that were signed several years ago.

“We are working with the Trump administration to explain the negative impacts of inflation has had on our industry, particularly these few years,” Shoaf said. “Hopefully the administration will be able to rapidly resolve the underlying concerns driving the new tariffs so our members can help build an even stronger economy.”

“Public sector nonresidential spending fell sharply in the last month of 2024, but that decline was likely a short-term phenomenon as the transition between presidential administrations and cold weather delayed construction work,” said Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. “While public sector activity should at least partially rebound in the coming months, high interest rates and an emerging trade war with Canada and Mexico will continue to weigh on many privately financed segments.

“What little private sector nonresidential momentum exists remains concentrated in just two segments,” said Basu. “Data centers, which are part of the office category, and manufacturing accounted for 94% of the increase in total nonresidential construction spending from December 2023 to December 2024. Activity in these segments, and perhaps only these segments, will remain elevated regardless of upward pressure on construction costs.”

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