The Dodge Momentum Index, issued by Dodge Construction Network, slipped 8.6 percent in March to 183.7 (2000=100) from the revised February reading of 201.0. In March, the commercial component of the DMI fell by 6.6 percent, and the institutional component decreased by 12.9 percent.
Commercial component
Commercial planning in March was driven down by fewer projects in the office and warehouse sectors, decreasing 29 percent and 11 percent, respectively. Institutional planning weakened more substantially, as healthcare fell 17 percent, education dipped 6 percent, and amusement planning activity dropped 14 percent. On the upside, however, a steady flow of research and development laboratories entered the queue, supporting the otherwise weakening sector. Year over year, the DMI remains 24 percent higher than in March 2022. The commercial component was up 37 percent, and the institutional component was 2 percent higher.
What Dodge says
“We are predicting the Dodge Momentum Index to work its way back to historical norms throughout 2023, concurrent with weaker economic conditions,” says Sarah Martin, associate director of forecasting, Dodge Construction Network. “Lending standards for small banks in particular have substantially tightened as banking insecurity intensifies. As a result, owners and developers are more likely to pull back in the short-term, which would further contract the DMI as we continue into the year.”
Sarah Martin, Dodge Construction Network's associate director of forecasting, delivers the March 2023 DMI report in this video on YouTube. The DMI is an economic indicator for nonresidential building projects, tracking the dollar value of these projects in their earliest stages of planning.
