Lower levels of non-residential and federal construction spending contributed to a drop in overall U.S. construction spending in January, according to figures released Thursday by the Commerce Department.
Overall, U.S. construction spending came in at a seasonally adjusted annual rate of $827 billion, representing a 0.1 percent drop from December levels.
The December figures, while still showing a 1.4 percent increase, were revised down slightly from the 1.5 percent increase initially reported.
Most market analysts had expected that the rate of growth would fall off somewhat from December levels, but the consensus among economists was that construction spending would still show a 1 percent increase.
The drop marks the first decrease in overall construction spending since July of 2011.
The overall drop in construction spending was largely a result of a steep 5.5 percent drop in federal construction spending, which contributed to a 0.2 percent decline in public construction spending.
State and local government construction spending, however, increased by 0.4 percent.
Of the total public construction spending, educational construction spending was down 0.9 percent, while highway construction spending was down 0.2 percent, adjusting for seasonal factors.
Total levels of private construction spending were essentially unchanged from December to January, with a 1.8 percent increase in residential construction spending offsetting a 1.5 percent drop in non-residential construction spending.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.