The latest nonresidential construction spending data is not flashing a red light, but it is clearly telling contractors to read the market more carefully. For merit shop leaders across Cincinnati, Dayton, Springfield, and Lima, the message is simple: the work is still there, but it is shifting by owner type, funding source, and project category.

Key Takeaways

This is an insider economic briefing from ABC Ohio Valley for merit shop contractors, estimators, suppliers, and owners making decisions in the Cincinnati, Dayton, Springfield, and Lima markets. The goal is to separate what is real from what is fading in the national nonresidential construction data and translate it into a local bid, labor, and cash-flow strategy.

• National nonresidential construction spending rose just 0.1% in April to a seasonally adjusted annual rate of about $1.25 trillion, signaling a flattening market rather than a freefall.
• Public construction spending climbed 0.4% in April, while private nonresidential construction spending fell 0.2%. That marked the seventh straight monthly decline for private work, leaving it nearly 8% below its December 2023 peak.
• Data center spending reached $50.7 billion and is up 28.1% year over year, making mission-critical, power-intensive, and related utility work one of the strongest expanding segments.
• Much of the private-sector weakness traces to a rapid decline in CHIPS Act–incentivized manufacturing megaproject awards. That matters directly to the Ohio Valley, where the Intel semiconductor buildout and broader manufacturing resurgence affect pipelines, suppliers, and labor demand.
• Every dollar spent on nonresidential construction creates a ripple effect on local economies. Construction spending stimulates job growth and demand for allied professional services, and a pipeline of nonresidential projects triggers growth in upstream industries such as materials, logistics, engineering, equipment rental, and distribution.

How to Read April’s Nonresidential Construction Numbers

The latest Census Bureau Value of Construction Put in Place survey release shows a market that is still moving but not accelerating broadly. In April, national nonresidential construction spending increased 0.1% to roughly $1.25 trillion at a seasonally adjusted annual rate.

That number represents the total dollar value of construction work put in place during the period, annualized and seasonally adjusted, so contractors can compare one month to another without the effects of normal weather and calendar distortions. The construction put-in-place survey captures spending in dollars on new structures, improvements to existing structures, labor, materials, design, and infrastructure.

Here is the practical read: April was not a collapse. But it was also not a strong growth month. Ten of 16 nonresidential subcategories gained in April, indicating that nonresidential construction growth is uneven across sectors.

The split matters more than the headline.

Category	April Signal	Compared With Recent Peak / Context	Contractor Read
Total construction spending	Mixed	Includes residential construction and nonresidential	Watch total construction, but do not rely on the blended number
Nonresidential construction	+0.1% in April	About $1.25 trillion SAAR	Flat national market with major segment divergence
Private construction spending	-0.2% in April	Nearly 8% below December 2023 peak for private nonresidential	Private pipelines require more owner and financing scrutiny
Public construction	+0.4% in April	Public work is carrying more of the load	Stronger pursuit case for infrastructure and institutional work

A seasonally adjusted annual rate (SAAR) is not the actual amount spent in a single month. It shows what the annual pace would be if the monthly rate were to continue for a full year. Contractors in Cincinnati, Dayton, Springfield, and Lima should care because SAAR helps reveal whether demand is expanding, flattening, or rolling over before local bid lists fully reflect the shift.

Construction spending is a key economic indicator for GDP growth, and nonresidential construction spending influences national GDP calculations. It also acts as a pillar for macroeconomic analysis because the metric connects owner confidence, government funding, borrowing costs, materials demand, and job creation, and shifts in Federal Reserve policy have led owners to reassess borrowing and project timing.

The metric encompasses expenditures on design, labor, materials, and infrastructure. Nonresidential construction spending is a key economic metric for commercial and public structures, and spending data is collected by government agencies such as the U.S. Census Bureau.

For historical context, construction spending was $1.84 trillion in February 2023. In February 2023, total construction spending was $1.84 trillion. Private construction spending accounted for 75% of total spending in 2016. Private construction spending accounted for 75 percent of total spending in 2016. Residential construction represents nearly 50% of total construction spending in many readings, depending on the cycle and measurement period. Nonresidential construction spending represented 60 percent of total spending in another period of sector mix, which is why contractors must always check the source, month, and revised data before drawing conclusions.

You may also see these data series in economic tools maintained by the Federal Reserve Bank of St. Louis, which helps users compare Census Bureau monthly estimates across construction, residential, nonresidential, private, and public sectors.

A few terms matter:

• Total construction spending includes residential and nonresidential work.
• Nonresidential construction includes commercial, industrial, institutional, infrastructure, and public development.
• Private construction includes owner-funded private commercial and industrial work.
• Public construction includes government-funded and public owner work such as schools, roads, water systems, and civic facilities.
• The Census Bureau’s monthly estimates are often revised, so an April report may be updated after the June release.

This is why ABC Ohio Valley urges members not to read one data point in isolation. The trend across January, February, March, and April tells a better story than one month alone.

Public Construction Spending vs. Private: Diverging Paths Contractors Must Account For

The current phase is best described as a divergence. Public construction is carrying more of the load as private construction cools.

Public construction spending rose 0.4% in April. That public spending strength reflects ongoing support from federal infrastructure programs, state capital budgets, highway construction, water and sewer investment, education projects, and local public safety needs across Ohio and neighboring states.

Private nonresidential construction spending moved in the opposite direction. Private construction spending fell 0.2% in April, marking the seventh consecutive monthly decline. The cumulative effect is more important than the single monthly dip: private nonresidential work is now nearly 8% below the December 2023 peak.

For contractors, this does not mean private work disappears. It means selectivity matters more.

Public-market categories helping support the totals include:

• Highways and streets, including highway construction, bridge work, and related civil scopes.
• Water and sewer systems, including utility upgrades and treatment facilities.
• Education buildings, including K-12, higher education, and training facilities.
• Public safety facilities, including fire, police, emergency operations, and municipal buildings.

These segments matter for Ohio Valley heavy/highway firms, utility contractors, concrete contractors, electrical contractors, and institutional builders. They also matter for suppliers and construction-related businesses that serve the broader project ecosystem.

By contrast, certain private segments are softening:

• Some manufacturing builds as the first wave of CHIPS Act announcements crests.
• Traditional offices, especially where vacancy and hybrid work continue to weigh on demand.
• Some speculative retail and commercial projects are exposed to higher borrowing costs.
• Lodging in submarkets where demand is not strong enough to support new starts.

Nonresidential projects are often affected by tight credit markets and high borrowing costs. Nonresidential construction spending is affected by borrowing costs and government infrastructure funding, and is primarily driven by government funding and interest rates at this point in the cycle.

Construction spending data helps gauge economic growth or recession. Economic growth is signaled by rises in nonresidential construction spending, while sustained declines in private categories can warn of tighter credit, weaker owner confidence, or delayed capital decisions.

What this means for 2026–2027 pursuit strategy: estimators and business development teams should tilt toward infrastructure, public facilities, and quasi-public owner work while staying selective but present in strategic private opportunities.

The point is not to abandon private construction. The point is to avoid filling the backlog with weak-margin, high-risk, slow-pay work just because the bid calendar looks busy.

Data Centers, Manufacturing, and the CHIPS Act: Where the Momentum Really Is

National nonresidential construction is increasingly shaped by a handful of megatrends: data centers, advanced manufacturing, reshoring, power demand, and public infrastructure.

Data center spending reached approximately $50.7 billion in April, up 28.1% year over year. That makes data centers one of the fastest-growing nonresidential categories and one of the clearest signs that not all private construction is fading.

Data center and mission-critical projects create direct opportunities for Ohio Valley firms:

• Electrical contractors can pursue switchgear, backup power, distribution, controls, lighting, grounding, and high-capacity service work.
• Mechanical trades can support cooling systems, piping, ventilation, and equipment installation.
• Sitework and concrete firms can support pad preparation, foundations, duct banks, road access, and utility corridors.
• Specialty suppliers can serve long-lead equipment, prefabrication, logistics, and replacement-part needs along the Cincinnati-Dayton corridor.

Surges in nonresidential spending drive demand for skilled labor. Job creation in construction supports millions of high-paying jobs, and construction spending pressures firms to increase hourly compensation during hiring spikes, especially for electricians, pipefitters, equipment operators, and foremen with mission-critical experience.

At the same time, manufacturing is more complicated.

Federal initiatives like the CHIPS Act significantly influence the viability of manufacturing projects. CHIPS Act–incentivized manufacturing megaprojects previously pushed national private construction spending higher. Now, the rapid decline in new CHIPS-driven awards is dragging down private numbers.

That does not mean semiconductor or advanced manufacturing work is dead. It means the market is shifting from announcement momentum to execution discipline.

For the Ohio Valley, that distinction is critical. The Intel semiconductor buildout in New Albany, along with related supplier and component plants, affects contractors well beyond central Ohio. Firms in Cincinnati, Dayton, Springfield, and Lima may see opportunities in subcontracting, logistics, warehouse builds, utility infrastructure, prefabrication, specialty equipment orders, and manufacturing support services.

A rise in nonresidential spending reflects strong long-term corporate optimism. Nonresidential investment builds the physical foundation for future economic growth. But commercial businesses spend hundreds of billions annually on construction, and when borrowing costs rise or demand forecasts change, even large owners slow the pace of new commitments.

That is what appears to be happening nationally: fewer new headline megaprojects, but still a strong base of already-awarded work.

Contractors should separate two realities:

1. New megaproject announcements are slowing.
2. Multi-year buildouts already in motion still require labor, materials, safety performance, and execution.

That is where ABC Chief Economist Anirban Basu’s recent commentary is especially useful. Basu has noted that April’s increase in nonresidential spending was driven by public-sector activity, while private nonresidential activity has continued to decline. His point for contractors is clear: the headline number is not enough. You have to know which segments are carrying the market.

Implications for the Ohio Valley: Intel, Suppliers, and Regional Manufacturing

The Ohio Valley is part of a Midwest manufacturing resurgence driven by semiconductors, automotive, aerospace, logistics, and advanced materials. That does not make the region immune to national softness, but it does give local contractors exposure to the better parts of the market.

Intel’s Ohio semiconductor project and its supplier ecosystem influence Cincinnati, Dayton, Springfield, and Lima through:

• Subcontracting opportunities with primes and specialty trade packages.
• Distribution center and logistics hub construction.
• Utility, power, road, and water infrastructure upgrades.
• Supplier, component, testing, and light industrial facilities.
• Workforce demand for MEP, concrete, civil, safety, and project management talent.

As CHIPS Act incentives move from the announcement phase to the execution phase, local firms should expect fewer new “headline” starts. But they should also expect steady demand for trades and specialty services tied to projects already in progress.

The best move now is to build relationships. Contractors should be developing ties with OEMs, tier-one suppliers, industrial owners, general contractors, and public agencies before packages hit the street.

ABC Ohio Valley plays a role here through networking events, owner-facing programming, workforce development, safety education, and economic briefings designed for merit shop contractors. Firms with strong safety records, apprenticeship pipelines, and proven performance on complex MEP and process work are especially well-positioned.

The opportunity is real. But it will reward firms that are disciplined, prequalified, trained, and financially prepared.

What ABC’s Backlog and Cost Data Say About 2026

ABC Chief Economist Anirban Basu remains one of the most important voices for merit shop contractors trying to interpret national nonresidential construction spending trends. His recent read on the April data is that the market’s small gain was driven by public work, while private nonresidential construction continued to weaken.

That aligns with the ABC Construction Backlog Indicator. In April 2026, ABC reported a backlog of 8.7 months, a 20-month high. That suggests many contractors still have work under contract, but the quality and sector mix of that backlog matter more than the headline.

Backlog remains strongest in:

• Infrastructure.
• Public institutional work.
• Certain industrial segments.
• Data center and power-related work.
• Advanced manufacturing projects already under contract.

Backlog is more uneven in:

• Traditional office.
• Speculative commercial.
• Certain retail.
• Private projects dependent on tighter financing.
• Legacy manufacturing not tied to advanced technology or strong demand.

High material costs can stall or cancel construction project pipelines. Rising material costs and wage pressures are compressing margins even when top-line revenues appear stable. Inputs where volatility is most notable include electrical gear, transformers, structural steel, concrete, controls, and certain mechanical equipment.

For owners, estimators, and preconstruction leaders, the question is not simply “How many months of backlog do we have?” The better question is:

Is this backlog profitable, buildable, financeable, and tied to owners who can pay on time?

That is where go/no-go discipline matters.

Contractors should review:

• Owner financial strength.
• Payment history.
• Bonding and prequalification requirements.
• Escalation language.
• Bid validity windows.
• Long-lead procurement exposure.
• Change order process.
• Labor availability.
• Schedule risk tied to utilities or permitting.

Public construction can look attractive, but it still requires compliance, documentation, and cash-flow planning. Private construction can still be profitable, but only when the owner, financing, scope, and schedule are solid.

Backlog and Cost Signals Ohio Valley Leaders Should Watch

• If public construction spending continues rising, expect more competition for highway, water, education, and municipal work.
• If private construction spending keeps falling, expect owners to rebid, defer, or resize projects.
• If data center and power work keep expanding, expect continued pressure on electrical labor and long-lead equipment.
• If materials prices rise faster than bid assumptions, margin protection will depend on escalation clauses, supplier relationships, and disciplined change orders.

This is also where monthly data matters. The April report, March revisions, February patterns, and January baselines together help contractors begin to see whether a category is truly expanding or simply experiencing a one-month bounce. The APR release is useful, but it should be read alongside the revised March, Feb, and January data on the same page.

Merit Shop Advantage in a Mixed-Demand Environment

The merit shop philosophy is straightforward: performance, safety, value, productivity, and workforce development should drive contracting decisions, not union status.

ABC Ohio Valley’s position is that open competition creates better outcomes for owners, taxpayers, and workers. Roughly 9 out of 10 construction workers in the Ohio Valley region are not union members, underscoring the depth of the open-shop labor pool serving nonresidential construction.

In a period where private construction spending is softening and public spending is rising, merit shop contractors have a real advantage:

• More flexibility in staffing.
• More flexibility in compensation and incentives.
• Greater ability to cross-train workers across segments.
• Stronger alignment between performance and advancement.
• More options for apprenticeships and career pathways.

ABC’s apprenticeship and workforce development programs help members build and upskill teams capable of tackling data centers, industrial plants, highway construction, public facilities, and complex institutional work without sacrificing safety or productivity.

Owners are watching budgets more closely. They need partners who can protect schedules, control costs, innovate in the field, and deliver safely. Merit shop contractors should clearly communicate their value proposition in every interview, proposal, and prequalification package.

Segment-by-Segment Outlook: Expanding vs. Fading Work

The rest of 2026 will not treat all nonresidential segments equally. Ohio Valley contractors need to know which buckets are expanding, which are stable, and which carry a higher risk.

Nonresidential construction spending serves as a vital economic indicator because it reveals where owners are still willing to commit capital. But the headline non-residential construction number can hide major differences between segments.

Expanding or Relatively Resilient Segments

Data centers and power-intensive facilities

• Strong national growth, with spending at $50.7 billion and up 28.1% year over year.
• Relevant to electrical, mechanical, civil, concrete, utility, controls, and specialty suppliers.
• Cincinnati and Dayton firms should watch corridor opportunities tied to power availability and logistics.

Select industrial and manufacturing

• Stronger where tied to Intel, automotive, aerospace, batteries, semiconductors, and advanced materials.
• Springfield and Lima contractors may see opportunities in supplier, retrofit, and industrial maintenance.
• The slowdown is in new megaproject awards, not necessarily in ongoing execution.

Public infrastructure

• Roads, bridges, water, sewer, and utility work remain supported by federal and state funding.
• Heavy/highway and civil contractors should watch public bid calendars closely.
• Public construction spending trends support a stronger pursuit posture in late 2026 and 2027.

Education and healthcare

• Institutional owners remain active where demographics, facility needs, and public funding support investment.
• These projects reward firms with discipline in safety, scheduling, and prequalification.

Logistics and warehouse work

• Cincinnati/Northern Kentucky intermodal assets continue to support demand for distribution and logistics.
• Not every warehouse deal is strong, but strategic locations remain attractive.

Contracting or Higher-Risk Segments

Traditional office

• Offices remain challenged by hybrid work, vacancy, and owner uncertainty.
• Renovation, repositioning, and adaptive reuse may be stronger than large new structures.

Speculative retail

• Some retail remains viable, but speculative projects face tighter lending and cautious tenants.
• Contractors should verify leases, financing, and owner capitalization before committing.

Legacy manufacturing

• Manufacturing not tied to advanced technologies, reshoring, or durable demand may grow more slowly.
• Maintenance, retrofit, and efficiency upgrades may outperform new starts.

Select lodging

• Lodging can work in strong travel submarkets, but overbuilt areas carry risk.
• Contractors should evaluate demand drivers before aggressively pursuing hospitality work.

Even in fading segments, niche renovation and adaptive reuse opportunities can be profitable. The issue is large-scale new starts. Through the end of 2026, owners and lenders in the Ohio Valley are increasingly favoring projects with strong long-term demand drivers: technology, healthcare, infrastructure, advanced manufacturing, and public need.

It is worth remembering that nonresidential construction spending was expected to slow significantly in 2024, and many of those pressures have carried forward into the current cycle. Higher borrowing costs, labor constraints, and material uncertainty did not disappear. They simply shifted which projects pencil out.

Positioning Bids, Labor, and Cash Flow

Company leaders, CFOs, and chief estimators should align estimating, operations, and finance around the current spending pattern. A flat market with sharp segment divergence punishes loose bidding.

Here are the practical steps.

1. Tighten go/no-go criteria

Do not chase every project. Prioritize segments with positive spending momentum and reliable owners. A smaller backlog with stronger margins can be healthier than a larger backlog filled with delay risk and weak payment terms.

2. Shift pursuit toward bankable work

Infrastructure, institutional, public safety, education, water/wastewater, data center, and certain industrial work deserve more attention. Private commercial projects still belong in the mix, but only when financing, tenant demand, and owner strength are clear.

3. Use backlog data for labor planning

Use ABC backlog data, known public construction awards, and private owner schedules to plan apprenticeships, foreman development, and cross-training. Crews that can shift between manufacturing, infrastructure, and institutional projects will be more valuable.

4. Protect cash flow

In a rising-cost environment, contractors should tighten change-order processes, negotiate favorable payment terms, and avoid overextending on delayed or speculative private work. Retainage, slow approvals, and long-lead equipment can strain even profitable projects.

5. Build pricing protection into bids

Where market conditions allow, use escalation clauses, shorter bid validity periods, allowances, and early procurement for critical-path items. The goal is not to overprice work. The goal is to avoid absorbing risks that no contractor can control.

6. Scenario-plan 2026–2027

Model at least three cases:

• Stable public growth and flat private work.
• Mild private slowdown with continued public strength.
• Stronger public surge with tighter labor and equipment availability.

Each scenario should include staffing, cash, bonding, equipment, supplier capacity, and margin assumptions.

How ABC Ohio Valley Helps Members Navigate Nonresidential Cycles

ABC Ohio Valley serves merit shop contractors across Cincinnati, Dayton, Springfield, Lima, and the broader regional market. Our role is to help members win work, train people, improve safety, advocate for open competition, and make better business decisions through changing construction cycles.

Workforce development and apprenticeship programs help supply skilled labor to expanding segments of nonresidential construction, such as data centers, industrial facilities, infrastructure, and institutional work.

Safety education and training help members maintain the performance owners increasingly require for prequalification on large public and private projects.

Advocacy at the state and local level helps preserve open competition, oppose restrictive project labor agreement mandates, and ensure public construction remains accessible to merit shop contractors.

Networking, peer groups, and market briefing events help members stay ahead of shifts in nonresidential construction spending. That includes economic updates informed by Anirban Basu’s national commentary, ABC data, census bureau releases, and regional owner intelligence.

For deeper regional forecasts, sector breakouts, and member resources, visit ABC Ohio Valley’s Construction Industry Outlook 2026 hub. It is designed to help contractors benchmark pipelines, compare sectors, and prepare for the next phase of the market.

Frequently Asked Questions

How quickly should I adjust my bid strategy given the 0.1% April nonresidential growth?

Do not panic over a single 0.1% month. But the combination of seven months of private spending decline and stronger public spending warrants immediate recalibration over the next 3–6 months.

Firms should gradually increase the pursuit of infrastructure and institutional work for late 2026 and 2027 delivery while remaining selective with private commercial and manufacturing bids. The most important shift is toward quality of backlog and owner strength, not a sudden reduction in bid volume.

What does the pullback in CHIPS Act megaprojects mean for smaller contractors?

Fewer new semiconductor megaprojects may be announced, but ongoing Intel-related and supplier projects still create substantial subcontracting opportunities for small and mid-size firms.

Smaller contractors should focus on specialty scopes, repeat performance with a few key primes, and targeted geographic coverage around logistics, warehousing, utility, and supplier facilities. ABC Ohio Valley networking can help members meet primes, owners, and vendors tied into the semiconductor and advanced manufacturing ecosystem.

How should I factor rising materials prices into my 2026 bids?

Use escalation clauses where market conditions allow, shorten bid validity periods, and pre-purchase critical-path items like electrical gear, switchgear, transformers, or major mechanical equipment when contracts permit.

Work closely with preferred suppliers to get forward-looking price indications and possible volume or timing discounts. Accurate contingency and realistic schedule assumptions are just as important as headline unit costs in protecting margins.

Is public construction really accessible to merit shop contractors in our region?

Yes. In the Ohio Valley, a large share of city, county, and state work remains open to competitive bidding by nonunion firms, especially in transportation, utilities, and smaller institutional projects.

ABC Ohio Valley actively advocates to keep markets competitive and opposes blanket project labor agreement mandates that would shut out merit shop contractors. Members new to public work should use ABC resources on prequalification, bonding, safety, documentation, and compliance.

Where can I find more detailed forecasts specific to Cincinnati, Dayton, Springfield, and Lima?

Visit ABC Ohio Valley’s Construction Industry Outlook 2026 hub for city-by-city demand outlooks, sector breakouts, and regular updates using ABC and Census Bureau data.

The hub also connects national insights from Anirban Basu’s briefings to Ohio Valley realities. Members should also attend upcoming ABC Ohio Valley economic update events to ask market-specific questions and compare their own pipelines against regional trends.