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Economy in Brief

U.S. Construction Spending Growth Strengthens
by Tom Moeller  June 1, 2015

Momentum in the building sector recovered of late, perhaps helped by better weather. The value of construction put-in-place increased 2.2% during April (4.8% y/y) following a 0.5% March rise, revised from -0.6%. Three-month growth of 14.4% (AR) was the strongest since late-2013. A 0.6% April rise had been expected in the Action Economics Forecast Survey.

Public sector building jumped 3.3% (3.5% y/y) and rose at a 16.6% rate during the last three months. Highway & street construction increased 8.5% (4.6% y/y); office construction rose 6.2% (4.2% y/y) while educational building gained 3.6% (1.6% y/y). Water supply construction improved 1.1% (0.6% y/y) but commercial building fell 8.9% (+12.4% y/y). Power construction gave up 15.0% (-31.3% y/y) while health care building slipped 0.6% (-11.1% y/y).

Building activity in the private sector improved 1.8% (5.3% y/y) and increased at a 13.6% rate during the last three months. Nonresidential building activity jumped 3.1% (13.4% y/y) with strong growth spreading across most sectors. Further improvement was evident in residential construction activity which gained 0.6% (-2.1% y/y). Single-family building strengthened 1.6% (9.2% y/y) and multi-family construction jumped 3.1% (24.6% y/y). Working the other way, however, spending on improvements continued down by 3.0% (-27.0% y/y).

The construction spending figures are in Haver's USECON database and the expectations figure is contained in the AS1REPNA database.

Construction Put in Place (%) Apr Mar Feb Apr Y/Y 2014 2013 2012
Total 2.2 0.5 0.6 4.8 6.1 5.7 9.2
  Private 1.8 0.9 0.5 5.3 8.0 10.1 16.0
    Residential 0.6 -1.0 0.2 -2.1 5.1 20.4 14.4
    Nonresidential 3.1 2.7 0.8 13.4 11.2 0.6 17.5
  Public 3.3 -0.4 1.0 3.5 1.5 -3.5 -2.8
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