U.S. Machinery & Construction: Square Footage Recession Persists: May 2026

Research evidence excerpt

U.S. Machinery & Construction: Square Footage Recession Persists: May 2026

Equity Research

18 June 2026

U.S. Machinery & Construction

Square Footage Recession

Persists: May 2026

May data reinforces our view: strong dollar activity but weak U.S. Machinery & Construction

volumes ('square footage recession'). Growth remains POSITIVE Unchanged

concentrated in AI/power, infrastructure is supportive but U.S. Machinery & Construction

Adam Seiden, CFAnormalizing, and conditions are firming – not inflecting –

keeping recovery narrow and somewhat rate-constrained. +1adam.seiden@barclays.com212 526 2212

BCI, US

May construction starts data is largely consistent with our State of Construction report Vraj Patel

(link to deck here, note here, replay here). +1 212 526 2773

vraj.patel1@barclays.com

The market continues to hold up in dollars, supported by mix and project scale, but physical BCI, US

volumes remain soft, with square footage still lagging. This aligns with our 'square footage Tyler Russell

recession' view that’s plagued the market and is still a headwind to seeing volume growth for +1 212 526 7584

many construction sectors. tyler.russell@barclays.com

The concentration in the AI value chain we highlighted last week is becoming more

Benjamin Falkpronounced rather than broadening out. Incremental growth remains heavily skewed toward

+1 212 526 9497

data centers, power, and select industrial activity, while more traditional categories –

benjamin.falk@barclays.com

particularly warehouses and parts of commercial – continue to lag. In that context, the market is BCI, US

behaving largely as expected, but with less evidence (so far) of a meaningful hand-off to

broader private non-res activity. European Business Services

James Rose, CFA