Total construction starts decreased 19 percent in September to a seasonally adjusted annual rate of $1.02 trillion, according to Dodge Construction Network. In September, nonresidential building starts dropped 23 percent, residential starts fell 11 percent, and nonbuilding starts declined by 25 percent.
More data
Year-to-date, total construction was 16 percent higher in the first nine months of 2022 compared to the same period of 2021. Nonresidential building starts rose 37 percent over the year, residential starts were flat, and nonbuilding starts were up 20 percent.
For the 12 months ending September 2022, total construction starts were 15 percent above the 12 months ending September 2021. Nonresidential starts were 34 percent higher, residential starts gained two percent, and nonbuilding starts were up 17 percent.
What this means
“September’s decline in construction starts should not be seen as a precursor to a cyclical pullback in the industry,” says Richard Branch, chief economist for Dodge Construction Network. “The previous two months saw the start of several megaprojects, and the decline in September returns starts activity to its trend level. It is likely, however, that as interest rates move higher in the coming months, marginal construction projects may not get underway and construction activity will begin to settle back.”
