US Construction Spending reaccelerated to all-time highs in April with capital inflows above $1.9T (annualized monthly spending) for the first time in US history.
Cascading foundational investments into the buildout of Industry 4.0 have created an economically agnostic US construction space with spending on next-generation manufacturing facilities being at the core of this secular expansion. US spending on new manufacturing more than doubled year-over-year (YoY), jumping 8.6% in just one month.
The historic cyclicality of the construction industry has been driven by new residential builds, which account for more than 50% of total construction spending during any given upcycle. US AEC investments are demonstrating a systemic shift towards much more secular growth drivers
The chart below depicts the YoY growth you can see the boom in manufacturing while residential construction begins to peter out.
The market-driving investments into US manufacturing can be attributed to the onshoring of international operations – specifically semiconductor fabrication plants with elevated geopolitical risk related to Taiwan Semiconductor Manufacturing Company, aka TSMC (where the majority of the world's advanced chips are fabricated) – along with the build-out of semi/fully-autonomous facilities, hedging our industrial sectors risk against the growing shortage of skilled workers.
Manufacturing made up less than 5% of total construction outlays this time last year, today it accounts for 10% of total AEC spending (18% of nonresidential building).