When I get more free time, I’ll expand of this much more. But for now here’s the preliminary forecast as of Jul spending.

Not good news. I’m looking at Construction Spending data and my forecast for 2026 is expected down 3.2%.

Residential down 5.9% and Nonres Bldgs down 5.0%. Nonbldg UP 4%. Overall, this would be the worst annual performance since 2010. Some recent revisions lowered Rsdn.

2026 Construction Spending in constant dollars (all years corrected for inflation) is expected down 7.4%. Also biggest drop since 2010.

The residential numbers are bad, but the worst of the Nonres Bldgs is the decline from Mnfg projects, and that was entirely predicted. When you have a huge influx of projects all start in a compact period, the tailend of those projects creates a very steep downward slope to get back to normal.

The biggest decline in Nonres Bldgs spending is once again Manufacturing. This is expected. I wrote about the Mnfg spending taper two years ago (see my pinned post). Mnfg accounts for $44bil in reduced spending this year. This is going to be repeated in Data Centers in coming years.

Year-to-date thru July already, Mnfg is down 22%, but that is -$29bil. Data Center are up 35% but that’s only +$10bil.

Good news is I’m expected (as of right now only) to see a 2% increase in total spending in 2027. Rsdn flat, Nonres Bldgs +3%, Nonbldg +4%. But even that will not be enough to outpace inflation, so Constant $ spending will post about a 2% decline.