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Economy in Brief

U.S. Construction Spending Improvement Slows Versus A Strong Spring
by Tom Moeller  October 1, 2015

The value of construction put-in-place increased 0.7% during August following a downwardly revised 0.4% rise in July. June's increase was revised higher to 0.6%. Three-month growth declined sharply to 6.8% (AR), down from 30.0% in the second quarter. A 0.5% August rise had been expected in the Action Economics Forecast Survey.

Building activity in the private sector increased 0.7% following a 1.1% July increase. Activity increased at a 6.1% rate during the last three months. Residential building activity rose 1.3% (15.9% y/y), the fifth consecutive month of strength. Multi-family building strengthened 4.8% (24.8% y/y), the strongest rise in six months. Single-family building increased 0.7% (14.0% y/y) after a 1.6% jump. Spending on improvements also improved 0.7% (16.3% y/y).

Public sector building continued to strengthen. It edged 0.5% higher (7.2% y/y), rising at an 8.9% annual rate during the last three months. Office construction improved 0.5% (13.1% y/y) but power construction jumped 10.0% (12.0% y/y). Water supply spending eased 0.4% (+4.3% y/y) and highway & street construction also fell 0.4% (+7.9% y/y). Educational construction eased 0.2% (+3.5% y/y) but health care jumped 1.0% (-8.0% 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 (SA, %) Aug Jul Jun Aug Y/Y 2014 2013 2012
Total 0.7 0.4 0.6 13.7 4.8 6.6 9.2
  Private 0.7 1.1 -0.4 16.7 6.0 11.3 15.9
    Residential 1.3 0.6 0.8 15.9 1.0 19.5 14.9
    Nonresidential 0.2 1.6 -1.5 17.7 11.3 3.6 16.9
  Public 0.5 -1.3 3.0 7.2 1.9 -3.1 -2.5
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