US construction spending edged up in August
By Chris Sleight03 October 2010
Construction spending in the US was +0.4% higher in August than July, at US$ 811 billion, on a rolling 12-month basis. However, this figure was still -10% lower than the output of US$ 902 billion in the year to August 2009.
The month-on-month rise was driven by increases in public construction, with a rise of +2.5% to US$ 317 billion. The small publicly funded residential sector was up +6.7% to US$ 8 billion, while non-residential activity was up +2.4% to US$ 309 billion.
However, these gains were almost wiped-out by a -0.9% fall in private sector construction. The residential market was down -0.3% to US$ 242 billion, while non-residential work for the 12-month period fell -1.4% to US$ 343 billion.
However, the picture was much bleaker compared to a year ago. At US$ 585 billion, private sector construction for the year to the end of August this year was -14.8% lower than in the previous 12 months. Event he firmer public sector was down -1.0% over the last 12 months, compared to the year ending in August 2009.
Commenting on the results, Ken Simonson, chief economist for the Associated General Contractors of America (AGC) said, "Federal investments from the stimulus and other programmes are protecting some construction workers from a devastating downturn in private construction activity, but the industry will continue to be at risk of greater economic hardships as long as private demand for construction continues to shrink."
Meanwhile, Patrick Newport, US Economist for forecasting company IHS Global Insight described it as, "Not a great construction spending report." Among the more worrying trends he highlighted the 23rd consecutive month of declines in the multi-family residential construction segment.