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ABC's Construction Economic Update covers the latest commercial and industrial construction economic news. Delivered electronically, it provides an analysis of the monthly economic indices released by the federal government, including construction spending, employment, the producer price index and the quarterly gross domestic product.  

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Posts Tagged 'Construction Economics'

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Nonresidential Construction Spending Expands for Seventh Consecutive Month

August marked the seventh consecutive month nonresidential construction spending expanded according to an Oct. 1 release supplied by the U.S. Census Bureau. Nonresidential spending totaled $696.3 billion on a seasonally adjusted, annualized basis in August, a 0.3 percent increase from the previous month and a 12.3 percent increase from the same time last year. The Census Bureau downwardly revised July’s estimate from $696.1 billion to $694.1 billion.

Construction Materials Dip for Second Consecutive Month

Prices for inputs to the construction industry fell 0.9 percent in August after shedding 0.1 percent in July. Inputs to nonresidential construction behaved similarly, losing 0.8 percent for the month and 4.7 percent for the year.

Difficulty in Finding Skilled Construction Workers Evident in Jobs Report

U.S. construction industry employment rose 0.1 percent in July and added 6,000 net new jobs, while the construction unemployment rate shed 0.8 percentage points and now stands at 5.5 percent. Nonresidential construction employment fell by 4,600 jobs in July after losing 800 jobs in June. Nonresidential specialty trade contractors lost 3,700 jobs for the month, while the nonresidential building sector declined by 900 jobs. Residential construction and the heavy and civil engineering segment added 8,200 and 2,900 net new jobs in July, respectively.

Nonresidential Fixed Investment Falls in Second Quarter

Nonresidential fixed investment fell by 0.6 percent during the second quarter after expanding by 1.6 percent during the first quarter, according to the July 30 real gross domestic product (GDP) report by the Bureau of Economic Analysis (BEA). For the economy as a whole, real GDP expanded by 2.3 percent (seasonally adjusted annual rate) during the second quarter following a 0.6 percent increase during the year’s first quarter. Note that the first quarter estimate for nonresidential fixed investment was revised upward from -3.4 percent annualized growth.

Construction Materials Prices up for May, Down for Year

Prices for inputs to construction industries expanded by 1.1 percent in May, the largest month-over-month increase in more than two years and only the third time in the past 10 months that construction input prices have grown on a monthly basis. Year-over-year prices fell by 3 percent in May and have now fallen by more than 3 percent in each of the year’s first five months. The last time this occurred was the third and fourth quarter of 2009. Only three of the 11 key construction inputs—nonferrous wire and cable, crude petroleum and crude energy materials—experienced monthly price increases in May.

Nonresidential Construction Growth Continues in May

The U.S. construction industry added 17,000 jobs in May according to the June 5 preliminary estimate released by the Bureau of Labor Statistics. April’s estimate was revised downward from 45,000 to 35,000 net new jobs. Nonresidential construction employment increased by 8,200 jobs in May, with nonresidential specialty trade contractors adding 5,600 jobs and nonresidential building employment expanding by 2,600 jobs. Residential construction employment added 8,500 net new jobs for the month.   

Nonresidential Construction Spending Surges in April

Today’s Census Bureau release regarding nonresidential construction spending did not just offer good news about April; it also supplied upwardly revised spending data for both February and March. Nonresidential spending expanded 3.2 percent on a monthly basis in April and spending totaled $646.7 billion on a seasonally adjusted, annualized basis, according to the government’s initial estimate. Nonresidential construction is up by a solid 8.8 percent over the past year, consistent with ABC’s forecast of high single-digit growth. The Census Bureau also revised March’s nonresidential spending figure from $611.8 billion to $626.7 billion, and February’s figure from $613.1 billion to $618.4. Initial estimates suggested that nonresidential construction was sagging during the early months of the year; however, the new data indicate spending has expanded during each of the previous three months.

Construction Materials Prices Remain Tame in April

Prices for inputs to construction industries fell by 0.1 percent in April, ending a two month streak during which material prices expanded by greater than 0.4 percent. Prices have now fallen in six of the previous eight months and input prices are also down on a year-over-year basis, falling 4 percent since April 2014. This represents the greatest year-over-year decline since October 2009 and year-over-year input prices have now declined for 5 straight months after expanding in each of the previous 60 months. Prices for inputs to nonresidential construction showed a similar decline, falling 0.1 percent for the month and 5.1 percent year-over-year. Crude petroleum prices expanded for only the second time in the previous ten months, growing by 13.1 percent, the largest month-over-month increase since November 2011.

Nonresidential Construction Bounces Back with the Broader Economy

The U.S. construction industry added 45,000 jobs in April according to the May 8 Bureau of Labor Statistics preliminary estimate. March’s estimate was revised downward from -1,000 to -9,000 net new jobs. Nonresidential construction employment increased by 12,400 jobs in April, with nonresidential specialty trade contractors leading the way with 20,200 new jobs. Nonresidential building employment plummeted for the month, losing 7,800 jobs. The residential sector bounced back in April, adding 23,600 jobs.  

Construction Materials Prices Expand in March

Prices for inputs to construction industries expanded 0.8 percent in March, the largest monthly increase in more than two years, according to the April 14 producer price index release by the Bureau of Labor Statistics. Prices have now expanded for two consecutive months after declining during the prior six; however input prices are down 3.6 percent on a year-over-year basis. March marks the fourth consecutive month year-over-year input prices have declined, the longest such streak since 2009. Crude petroleum prices fell 4 percent in March and have fallen in eight of the previous nine months.