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Economy in Brief

U.S. Construction Spending Rises in November But Offset by September's Downward Revision
by Gerald D. Cohen  February 1, 2019

In a delayed release of November data, the value of construction put-in-place rose a greater than expected 0.8% month-on-month (3.4% year-on-year). The Action Economics Forecast Survey expected a 0.3% gain. October's previously-reported decline was revised to a slight increase (0.1%), while September's reading was revised substantially lower. Third quarter construction spending is now 3.6% (annualized) below its second quarter level, down from -1.4%. Thus, construction-related components of GDP – private residential investment, nonresidential structures, and potentially even government spending – are likely to be revised down in the third quarter.

This release suggests a mixed result for the fourth quarter. Given the data we have in hand, private residential and nonresidential structures outside of oil drilling looks to be a drag on GDP growth, while public construction is on track to add to growth.

The construction spending figures, some of which date back to 1946, are in Haver's USECON database. The expectations reading can be found in the AS1REPNA database.

Construction Put in Place (SA, %) Nov Oct Sep Nov Y/Y 2017 2016 2015
Total 0.8 0.1 -1.8 3.4 4.5 7.0 10.7
  Private 1.3 -0.3 -1.6 2.3 7.1 9.2 12.9
    Residential 3.5 -1.1 -2.0 0.8 12.4 10.7 14.2
    Nonresidential -1.2 0.6 -1.1 4.2 1.3 7.7 11.5
  Public -0.9 1.5 -2.5 7.0 -3.2 0.7 5.1
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