>

Yup – Construction Spending Has Almost Fallen off the Chart

Construction spending in the USA is falling to the point that Econintersect may have to adjust the scales it uses to graph this activity.  We drew a line to point out where January 2011 spending was shown nearly off the chart.

The official data release states:

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during January 2011 was estimated at a seasonally adjusted annual rate of $791.8 billion, 0.7 percent (±1.4%)* below the revised December estimate of $797.6 billion. The January figure is 5.9 percent (±1.8%) below the January 2010 estimate of $841.0 billion.

PRIVATE CONSTRUCTION: Spending on private construction was at a seasonally adjusted annual rate of $490.0 billion, 1.2 percent (±1.1%) below the revised December estimate of $495.9 billion. Residential construction was at a seasonally adjusted annual rate of $245.6 billion in January, 5.3 percent (±1.3%) above the revised December estimate of $233.2 billion. Nonresidential construction was at a seasonally adjusted annual rate of $244.4 billion in January, 6.9 percent (±1.1%) below the revised December estimate of $262.7 billion.

PUBLIC CONSTRUCTION: In January, the estimated seasonally adjusted annual rate of public construction spending was $301.8 billion, 0.1 percent (±2.1%)* above the revised December estimate of $301.6 billion. Educational construction was at a seasonally adjusted annual rate of $70.2 billion, 1.7 percent (±3.2%)* above the revised December estimate of $69.0 billion. Highway construction was at a seasonally adjusted annual rate of $85.4 billion, 0.7 percent (±6.2%)* below the revised December estimate of $86.1 billion.

Note that Econintersect only uses unadjusted data so these numbers will vary from the seasonally adjusted numbers used by other sources.  Playing with the numbers:

  • Construction is down 6% YoY in January, and was down 6% YoY in December 2010.
  • Private construction is down 9% YoY, but public construction is up 2% YoY.
  • Roughly speaking – 2/3rds of construction spending is private.

Construction, unlike other many sectors – has a fairly large multiplier for jobs creation through the economy, about 1.9 according to a recent GEI Analysis article.     The continuing collapse of construction spending is putting strong headwinds on jobs.

Econintersect’s review of residential construction permits and completions does offer some hope that this industry is bottoming (analysis here).

Share this Econintersect Article:
  • Print
  • Digg
  • Facebook
  • Yahoo! Buzz
  • Twitter
  • Google Bookmarks
  • LinkedIn
  • Wikio
  • email
  • RSS
This entry was posted in Construction Spending and tagged , , , . Bookmark the permalink.










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.





One Response to Yup – Construction Spending Has Almost Fallen off the Chart

  1. Pingback: Beware: Core CPI Follows Food Inflation | Global Economic Intersection