· Construction activity moved lower, again. During December construction outlays fell 1.2% after a 1.2% November shortfall that was double the initial estimate. The latest decline was double the Consensus estimate. The worst of the news, however, was that for the full year the 12.2% shortfall in activity was nearly double the 2008 rate of decline and the third consecutive yearly drop.

· The December decline in residential building activity matched its November rate and pulled spending down again by nearly one-third y/y. Moreover, the latest level was nearly two-thirds below the 2006 high. Single-family construction activity has shown positive growth for the last seven months; however, the monthly gains have been steadily receding and overall activity was down one-half for the year. That was fourth consecutive year of lower residential building activity and it's off three-quarters from the 2006 peak. Multi-family construction activity fell nearly one-third for the year and it is off nearly two-thirds from the 2007 peak. The source of relative strength came from residential improvements which fell just 2.2% for 2009 and was off just one-quarter from the 2007 peak. 

· Nonresidential building activity fell another 1.8% during December and was off 11.2% for the year. Since the 2008 peak, activity has fallen by 26.9%. Spending in the food & beverage industry fell by one-third for the year. Expenditures in the lodging industry were off a similar amount. Commercial building overall fell by two-thirds y/y while office building dropped similarly. Relatively moderate were the declines in the education (-9.8% y/y), religious (-10.6% y/y) and health care (-5.1% y/y) sectors. 

· In the public sector, construction rose 3.7% for the year, despite lower tax revenues. Building activity on highways & streets rose 3.3% for the year as the focus on infrastructure rebuilding grew. Public spending on health care facilities increased a strong 14.7% y/y but building in the education sector rose just 1.5% for the full year.

· The construction put-in-place figures are available in Haver's USECON database. 

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