Construction spending went up in April. Look past the headline and the picture splits in two.
The Census Bureau put April construction spending at a seasonally adjusted annual rate of $2,172.4 billion, 0.4% above March and 0.9% above a year earlier. Public work carried the month. Private nonresidential spending slipped 0.2%, and spending on nonresidential structures has now contracted for nine straight quarters. The growth is narrow, and it has an address: the data center.
Data centers are propping up the nonresidential number
Spending on data centers, which Census files under the office category, rose another 1.9% in April to a $50.7 billion annual rate. That’s up 28.1% over the past year. Strip that single line out and nonresidential building looks soft across offices, retail and warehouses. The AI buildout isn’t just a tech story. It’s holding up a chunk of the national construction spending figure, which is why the strain between that pipeline and the grid keeps surfacing as a power-supply problem more than a construction one.
Public dollars do the rest of the work
Public nonresidential spending rose 0.4% on the month, the kind of steadying hand that infrastructure-bill money was supposed to provide. Highways, water and public buildings keep contractors busy even as private owners hesitate on offices and stores. Residential was a mixed bag, with high financing costs still weighing on homebuilders.
None of this is a surprise to anyone watching the forward indicators. Planning momentum has been choppy all year, and the Dodge Momentum Index, which leads spending by a year or more, has leaned on institutional and data center work to stay positive. April’s spending report is that forecast arriving on schedule.
What to watch next
The question for the back half of 2026 is whether anything besides data centers and public budgets can pull nonresidential out of its slump. Material costs are still elevated, financing is still tight, and owner confidence hasn’t recovered. Until private offices and retail find a floor, one category and one funding source are keeping the topline green. That’s a thin base for a $2.17 trillion industry.
Sources: U.S. Census Bureau, Engineering News-Record.