Overview
The U.S. Census Bureau reported that total non-residential construction spending increased 0.1% year-over-year in March, reversing a 0.2% year-over-year decrease recorded in the previous month, according to Stifel.
Non-building versus building
Stifel's review of the Census Bureau numbers highlights a divergence between non-building and building construction categories. Non-building spending showed clear year-over-year gains while building spending declined.
- Non-building spending rose 5.1% year-over-year.
- Building spending fell 3.0% year-over-year.
Breakdown within non-building construction
Stifel noted several specific non-building subcategories that posted notable increases in March on a year-over-year basis:
- Sewage and waste disposal spending increased 7.9% year-over-year.
- Conservation and development spending rose 8.5% year-over-year.
- Power spending grew 5.7% year-over-year.
Breakdown within building construction
Within the building construction category the pattern was mixed, with one very large gain offset by several sizable declines:
- Data center spending surged 33.7% year-over-year.
- Manufacturing spending declined 17.4% year-over-year.
- Office spending dropped 7.9% year-over-year.
Stifel's observations and market context
Stifel pointed to hyperscaler capital expenditures tied to artificial intelligence investments as a continuing driver of the strong data center spending. The firm also emphasized that manufacturing spending faces tougher comparisons, noting prior tailwinds from the Inflation Reduction Act that supported battery plant activity and lifted manufacturing spending in earlier periods.
On warehousing, Stifel observed that recent softness appears to be moderating and identified 2026 as a year when improvement is possible. The firm highlighted warehouse construction as an important end market for construction materials, implying that changes in warehouse activity have implications for materials demand.
What the data shows
In sum, the March data reviewed by Stifel shows modest overall year-over-year growth for non-residential construction spending, driven mainly by non-building categories and a pronounced jump in data center investment, while several building subsegments remain under pressure.