Key economic indicators in the construction industry reflected mixed momentum in September, influenced by interest rate cuts and election uncertainty.
Nonresidential planning activity, a gauge of future work, cooled slightly after months of growth, reflecting cautious optimism in the sector. Input prices dipped on lower energy costs, alleviating some pressure on builders. Meanwhile, contractor backlog rebounded, spurred by a recent rate cut that improved financing conditions and boosted builder confidence across most U.S. regions.
Despite these positive signs, construction starts fell in September as some developers paused projects amid potential policy shifts.
Still, as economists anticipate another rate cut this week, contractors suggest steadier construction growth may emerge in early 2025, particularly as spending on public projects continues to drive overall construction activity. Read on for details.