Q1 2024: Construction Industry updates

Apr 8

Total US construction starts ended 2023 on a positive note as they grew 20% in December and rebounded from a drop in November. Still, at the end of the year the commercial segment was still down 12% from year-ago levels. So far this year, the Q1 Dodge Momentum Index (DMI*) remains flat as of January 2024, but this stagnant pace should be short lived as we see lending standards loosen. Owners and developers are gaining confidence in market conditions for the back-half of 2024 & into 2025. [1]

* The DMI is a monthly measure of the value of nonresidential building projects going into planning, shown to lead construction spending for nonresidential buildings by a full year.

The positive momentum we saw in December’s data will continue to build as we look at the planning queue for 2024.

-Richard Branch, chief economist for Dodge Construction Network [1]

Scarce labor, tight credit, and worry for demand of construction firms are still concerning factors but the construction sector outlook is more positive than anticipated at this point in Q1, 2024. [2]

[1] Roepke, A. (2024, February 8). Dodge momentum index remains flat in January. Dodge Construction Network. https://www.construction.com/company-news/dodge-momentum-index-remains-flat-in-january/ 

[2] Dodge Construction Network. (2024, January 18). Construction starts - December 2023. YouTube. https://www.youtube.com/watch?v=SGiQUYN_D40