March 2, 2026
C&I Construction Starts Drop 15.4% To Begin The Year
Manufacturing jump cannot offset broad commercial slowdown
Total construction starts edged up just 0.7% in January to a seasonally adjusted annual rate of $1.24 trillion, according to Dodge Construction Network — but the headline number tells only part of the story. Nonresidential building starts fell a significant 15.4% and residential starts dropped 6.4%, meaning growth was entirely dependent on a 24.3% surge in nonbuilding construction driven by a handful of massive energy and infrastructure projects.
Dodge's chief economist noted that three mega projects in the nonbuilding sector accounted for nearly $20 billion — almost half of total January growth — and that without those projects, the overall construction market would have posted a decline for the month. On a year-over-year basis, total starts are up 5.0% from January 2025, though residential starts are down 17.0% and nonresidential starts are down 10.3% over the same period. The underlying picture heading into 2026 reflects a construction market increasingly dependent on large-scale energy and infrastructure investment to offset softness in buildings.
Monthly Construction Starts
| Sector | Jan 2026 | Dec 2025 | % Change |
|---|---|---|---|
| Nonresidential Building | $378B | $447B | -15.4% |
| Residential Building | $345B | $369B | -6.4% |
| Nonbuilding Construction | $522B | $420B | +24.3% |
| Total Construction | $1,245B | $1,236B | +0.7% |
"Nonbuilding construction remained the primary engine of growth in the first month of 2026. Three mega projects in the nonbuilding sector accounted for nearly $20 billion or almost half of the growth in January, which would mean total construction would have been negative without those three projects."
- Electric Power/Utilities (+184.8%): Dominated nonbuilding surge
- Manufacturing (+97.5%): Sharp rebound in January
- Warehouses (+10.2%): Continued steady activity
- Single Family (+1.5%): Modest month-over-month gain
- Offices & Data Centers (-52.2%): Sharp pullback after strong December
- Multifamily (-17.8%): Retreats from recent highs
- Education (-21.9%): Dragged institutional sector lower
- Highways & Bridges (-42.3%): Offset nonbuilding gains
