Total construction starts in the US declined 5% from February to March to a seasonally adjusted annual rate of $746.9 billion, with the full impact of Covid-19 still to emerge, said Dodge Data & Analytics this week.
In March, non-residential building starts fell 9% from February, while residential building dropped 11%, as the Covid-19 crisis started to have an impact at the end of the month.
Non-building construction jumped 14% in March due to the start of several large electric power facilities.
“Considering the calamity that occurred towards the end of March as the fallout from the Covid-19 (Coronavirus) hit the economy, construction starts held up rather well,” said Richard Branch, Chief Economist for Dodge Data & Analytics.
“Construction starts in March were unlikely to be greatly impacted as projects that broke ground during the month likely had materials sourced and in-place and labour booked well ahead of the scheduled groundbreaking. That momentum and planning is difficult to reverse at the last minute.
“Additionally, most of the stay-at-home orders and construction moratoriums were not instituted until the last week of the month and into April. Therefore, April construction starts are likely to be a very different story with states like New York, New Jersey, and Pennsylvania among others banning construction activity.
”April’s starts data will be the first true indication of how the crisis will impact the construction industry.”
The Dodge Index dropped to 158 (2000=100) in March from the 167 posted in February (see graph above).