Construction starts fell in September, essentially erasing August’s gains, according to the latest report from Hamilton-based Dodge Data & Analytics.
The firm said in its Dodge Index that total construction starts fell 18% in September, to an adjusted annual rate of $667.7 billion. While part of the decline may be due to several large projects starting in August, the rate also fell below the pace seen in June and July.
Nonresidential starts fell 24%, while residential starts fell 21% and nonbuilding starts — projects such as infrastructure or utility plants — were 5% lower.
For September, the Dodge Index fell 18%, to 141, from August’s 173 level. In the index, 100 represents the year 2000.
“That construction starts took a significant step back in September is disappointing, but also not surprising,” Richard Branch, Dodge’s chief economist, said in a prepared statement. “The economic recovery has lost momentum and is showing strain since support provided to consumers and businesses from expanded unemployment insurance benefits and the Paycheck Protection Program have expired.
“The worsening budget crisis for state and local areas has also slowed growth in public project starts, particularly in the face of a somewhat uncertain outlook for federal infrastructure spending programs. The road to recovery will continue to be uneven and fraught with potholes until a (COVID-19) vaccine is developed and widely adopted across the U.S.”
Year-to-date, total starts are down 14% from the same period in 2019, Dodge noted, with nonresidential starts down 26% and nonbuilding starts down 18%. On the upside, through nine months, residential starts are up 1%.