Slight dip in August for nonresidential spending
Private nonresidential construction spending was virtually unchanged in August, falling just 0.1 percent, according to the Oct. 1 report by the U.S. Census Bureau. However, compared to August 2008, spending is down 10.5 percent. Total nonresidential construction spending, including both private and public, slipped 0.4 percent from July, and is down 4.7 percent from August 2008, to $684.5 billion. In addition, total nonresidential construction spending in June and July were revised downward, from $711 billion to $700 billion in June and from $703.8 billion to $687.6 billion in July.
Among 16 nonresidential construction subsectors, four posted increases in August, with the biggest gains registered in manufacturing construction, up 5.1 percent, and conservation and development-related construction, up 2.5 percent. On a year-over-year basis, manufacturing construction is up 30.4 percent and power-related construction is 9.1 percent higher.
Those subsectors with the largest losses from July were water supply construction, down 5.5 percent; amusement and recreation construction, down 5.3 percent; public safety construction, down 3.7 percent; lodging, down 3.4 percent; and office construction, down 2.7 percent. Compared to August 2008, lodging is down 36.1 percent, commercial construction is 33.3 lower and office construction is down 22.3 percent.
In contrast, residential construction spending continues to expand, up 4.2 percent in August, but still down 26 percent from one year ago. Overall, total construction spending is up slightly — 0.8 percent at $941.9 billion — but still down from August 2008 levels.
Anerban Basu is chief economist with Associated Builders and Contractors, a national association representing 25,000 merit shop construction and construction-related firms within the U.S.