Construction Starts Economy

Regional US Construction Activity Splits Sharply Through April

KEY POINTS

  • Through April, five of nine Census divisions are ahead, led by East North Central up 91.4%, Pacific up 43.3%, and Middle Atlantic up 42.3%, while New England, East South Central, and Mountain are each down more than 11%.

  • Nonresidential Building is the most uneven category. East North Central is up 180.7%, driven by Indiana up 422.7% and Illinois up 352.5%, while Mountain, New England, and East South Central are each down more than 18%.

  • Civil work is favoring coastal markets. Middle Atlantic is up 98.7% and Pacific up 72.7%, while much of the Central U.S. is flat or declining, underscoring an uneven infrastructure pipeline.

Year-to-date construction activity through April is sharply divided by geography. Five of nine Census Bureau divisions are ahead of last year’s pace, but the gap between the strongest and weakest markets is wide.

East North Central is up 91.4%, the Pacific is up 43.3%, and the Middle Atlantic is up 42.3%. South Atlantic and West South Central are also positive, up 25.1% and 20.2%, respectively. New England, East South Central, and Mountain are each down more than 11%.

West North Central is essentially unchanged.

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The divergence is sharpest in Nonresidential Building (NRB). East North Central posted a 180.7% NRB gain year-to-date — a figure driven almost entirely by Indiana which was up 422.7%, and Illinois, which rose 352.5%, as a concentration of large projects lifted the entire division.

Outside of those two states, the division’s result would look far more typical. South Atlantic and West South Central are solidly positive at 47.1% and 33.9%. Mountain, New England, and East South Central are each down more than 18%, meaning contractors in those markets are competing for a meaningfully smaller pool of work than a year ago.

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Civil construction is following a different pattern. The Middle Atlantic is up 98.7% and the Pacific is up 72.7%, reflecting significant infrastructure commitments in those divisions. Following behind are the Mountain and South Atlantic divisions which are up 18.3% and 25.1% respectively.

In contrast, the four Central regions are facing stalling activity if not outright declines this year. The Civil picture reinforces that infrastructure dollars are flowing to a limited set of coastal geographic markets and leaving much of the nation’s interior lagging behind.

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Michael Guckes, Chief Economist
Michael Guckes is regularly featured as an economics thought leader in national media, including USA Today, The Wall Street Journal, and Marketplace from APM. He started in construction economics as a leading economist for the Ohio Department of Transportation. He then transitioned to manufacturing economics, where he served five years as the chief economist for Gardner Business Media. He covered all forms of manufacturing, from traditional metalworking to advanced composites fabrication. In 2022, Michael joined ConstructConnect's economics team, shifting his focus to the commercial construction market. He received his bachelor’s degree in economics and political science from Kenyon College and his MBA from the Ohio State University.