Number of new construction starts in US declines

Total construction was 14% lower in January 2023 than in January 2022 in the US

Total construction starts in the US fell 27% in January to a seasonally adjusted annual rate of $865.6 billion, according to a report from the Dodge Construction Network.

During the month, nonresidential building starts fell 38%, residential starts by 20%, and nonbuilding starts declined by 16%.

Comparatively, total construction was 14% lower in January 2023 than in January 2022. Nonresidential building starts were down 2%, nonbuilding starts rose 10%, and residential starts lost 34%.

For the 12 months ending January 2023, total construction starts were 13% higher than the 12 months ending January 2022. Nonresidential starts were 36% higher, residential starts lost 6%, and nonbuilding starts were up 19%.

“January’s decline in construction starts should not be taken as the beginning of a cyclical downturn in the industry,” said Richard Branch, chief economist for Dodge Construction Network.

“Numerous mega-projects have begun over the last few months, obscuring the underlying trend in construction activity. While some construction sectors will face stress as the year progresses, current fundamentals point to an industry that is fairly well positioned to weather the storm.”