Total Construction Starts Declined 19% in June on Non-Building Loss

Bedford, MA, July 24, 2024-Total construction starts lost 19% in June, falling to a seasonally adjusted annual rate of $1.0 trillion, according to Dodge Construction Network. Much of the decline was due to a stark decline in utility/gas starts following a strong May that saw several megaprojects get underway. 

During the month, nonbuilding starts fell 46% (following a 49% gain in May), while nonresidential starts fell 13%. Residential starts rose 9% during the month. On a year-to-date basis through June, total construction starts were up 7% from the first six months of 2023. Residential starts were up 14%, while nonbuilding starts gained 8%, and nonresidential building starts rose 1%.

For the 12 months ending June 2024, total construction starts were up 1% from the 12 months ending June 2023. Nonresidential building starts were down 7%, residential starts were up 7%, and nonbuilding starts were up 8% on a 12-month rolling sum basis.

“The construction market remains sluggish as high interest rates continue to reverberate through the sector,” said Richard Branch, chief economist of Dodge Construction Network. “However, the Dodge Momentum Index, which tracks nonresidential building projects entering the planning phase, has been reasonably steady over the last year indicating that owners and developers remain cautiously optimistic that the conditions will be more conducive to construction in the future. But moribund starts activity means that these projects are piling up like water behind a dam. Lower rates in 2024 will allow these projects to start flowing again, resulting in a quicker pace of activity towards year-end.”