Global| Sep 01 2010U.S. Construction Activity Declines For Third Month
by:Tom Moeller
|in:Economy in Brief
Summary
The news from the construction sector continues bleak. Overall, the value of construction-put-in-place fell 1.0% during July after earlier months' figures were revised sharply lower. The July decline was double the Consensus [...]
The news from the construction sector continues bleak. Overall, the value of
construction-put-in-place fell 1.0% during July after earlier months' figures
were revised sharply lower. The July decline was double the Consensus
expectation. Monthly declines in private construction continued across-the-board
though there has been some moderation in the rates of decline in recent months.
Nevertheless, the level of overall July activity remained one-third below the
2006 peak.
Residential building activity fell a sharp 2.6% during July led by a 2.9% decline (+12.4% y/y) in spending on improvements. Single-family construction activity also fell a hard 2.5% (13.8% y/y) following the 1.1% June drop. Activity was off three-quarters from the late-2006 high. Multi-family building also dropped 1.5% (-51.6% y/y).
Nonresidential building activity posted a 0.8% monthly increase. Since the 2008 peak, activity has fallen by one-third but the latest increase was led by an 8.3% gain (-12.1% y/y) in power facilities and a 4.7% increase (-5.4% y/y) in communications. Spending on multi-retail commercial structures fell 2.1% (-23.0% y/y) while office building fell 3.3% (-40.0% y/y); more-than half below its early-2008 peak.. Health-care building also slipped 0.4% (-14.2% y/y) and spending on educational facilities fell 1.3% (-19.5% y/y).
Spending in the public sector also moved down 1.2% and was 7.9% below its peak 12-months ago. The latest decline reflected a 1.3% drop (-8.6% y/y) in nonresidential spending paced by a 2.9% drop (-7.0% y/y) in highways & streets which accounts for one-quarter of all public construction. Spending on health care rose 4.7% (-4.8% y/y) but transportation spending fell 3.8% (-1.4 y/y).
The construction put-in-place figures are available in Haver's USECON database.
The minutes to the latest FOMC meeting are available here here.
| Construction Put In Place (%) | July | June | May | Y/Y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total | -1.0 | -0.8 | -2.8 | -10.7 | -14.9 | -7.5 | -1.4 |
| Private | -0.8 | -1.6 | -3.6 | -12.2 | -21.9 | -12.2 | -5.5 |
| Residential | -2.6 | -2.0 | -4.7 | 5.5 | -29.9 | -29.0 | -19.7 |
| Nonresidential | 0.8 | -1.2 | -2.5 | -23.7 | -15.0 | 10.5 | 23.9 |
| Public | -1.2 | 0.6 | -1.4 | -4.1 | 2.2 | 6.6 | 13.1 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
More Economy in Brief
