Construction Spending Breaks 45 Month Losing Streak in August 2011

US Census says construction spending is up 1.4% month-over-month (versus Econintersect’s 2.9%) seasonally adjusted in August 2011. If this was ever a month to tout good data, it seems like the obvious is being missed.

Construction spending has been declining year-over-year for 45 straight months.  That is almost four years of headwinds for GDP.  Surprise – it is up a whopping 1.4% year-over-year.  Forgive the sarcasm.

Construction spending is the last bastion of economic decline resulting from the Great Recession.  It comes at a time when ECRI is forecasting a new recession is coming.

These numbers are NOT inflation adjusted, and in reality construction activity by estimated units of work is down between 3% and 7% depending on which inflation index you want to use.

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during August 2011 was estimated at a seasonally adjusted annual rate of $799.1 billion, 1.4 percent (±2.1%)* above the revised July estimate of $788.3 billion. The August figure is 0.9 percent (±1.9%)* above the August 2010 estimate of $791.7 billion.

During the first 8 months of this year, construction spending amounted to $511.4 billion, 3.0 percent (±1.3%) below the $527.3 billion for the same period in 2010.

PRIVATE CONSTRUCTION

Spending on private construction was at a seasonally adjusted annual rate of $511.0 billion, 0.4 percent (±1.3%)* above the revised July estimate of $508.9 billion. Residential construction was at a seasonally adjusted annual rate of $237.8 billion in August, 0.7 percent (±1.3%)* above the revised July estimate of $236.2 billion. Nonresidential construction was at a seasonally adjusted annual rate of $273.1 billion in August, 0.2 percent (±1.3%)* above the revised July estimate of $272.6 billion.

PUBLIC CONSTRUCTION

In August, the estimated seasonally adjusted annual rate of public construction spending was $288.2 billion, 3.1 percent (±3.0%) above the revised July estimate of $279.4 billion. Educational construction was at a seasonally adjusted annual rate of $72.7 billion, 4.3 percent (±4.8%)* above the revised July estimate of $69.8 billion. Highway construction was at a seasonally adjusted annual rate of $80.2 billion, 3.5 percent (±8.6%)* above the revised July estimate of $77.4 billion.

This month, the data says that public construction grew, as well as private construction – however public construction is down over 6% year-over-year.

Last couple of months the growth stalled.  This month the upward trend continues to hold.

Related Articles:

All Construction Spending Articles

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