Global| Jan 07 2008U.S. Construction Spending Up Slightly in November
by:Tom Moeller
|in:Economy in Brief
Summary
The value of construction put in place rose slightly in November by 0.1%. That followed a 0.4% October decline which was softer than the 0.8% drop reported initially. The revision was due to a rise in nonresidential building instead [...]
The value of construction put in place rose slightly in November by 0.1%. That followed a 0.4% October decline which was softer than the 0.8% drop reported initially. The revision was due to a rise in nonresidential building instead of the decline indicated last month. The three month growth in total construction activity remained at a stable at -0.1% (AR), an improvement from the 2.3% rate of decline last Autumn.
In November, residential building continued lower. The 2.4% m/m decline was the largest of the current down cycle and it dropped the three month change to -24.4% (AR). Building of new single family units fell 5.0% m/m (-41.2%, three month, AR) and spending on improvements gained 0.7% (6.7%, three month, AR).
During the last twenty years there has been an 84% correlation between the q/q change in the value of residential building and its contribution to growth in real GDP.
Nonresidential building continued strong and produced a 1.7% rise after a increase 1.2% during the month prior. Three month growth remained quite firm at 24.4% (AR) due to a 37.2% three month rise in office construction and a 21.7% rise in multi-retail building. Commercial construction got back in the upside act with a 12.1% three month gain and educational facility building rose 34.2%.
A 2.5% November rise in public construction spending raised the three month growth rate to 22.2%. Construction on highways & streets rose 32.1% (AR) on a three month basis. The value of construction on highways & streets is nearly one third of the value of total public construction spending. Construction spending on educational facilities again was strong with a 19.1% three month rise.
These more detailed categories represent the Census Bureau’s reclassification of construction activity into end-use groups. Finer detail is available for many of the categories; for instance, commercial construction is shown for Automotive sales and parking facilities, drugstores, building supply stores, and both commercial warehouses and mini-storage facilities. Note that start dates vary for some seasonally adjusted line items in 2000 and 2002 and that constant-dollar data are no longer computed.
Recent and Prospective Developments in Monetary Policy Transparency and Communications: A Global Perspective is today's speech by Fed Vice ChairmanDonald L. Kohn at the National Association for Business Economics Annual Meeting in New Orleans, Louisiana and is available here.
| November | October | Y/Y | 2006 | 2005 | 2004 | |
|---|---|---|---|---|---|---|
| Total | 0.1% | -0.4% | -0.1% | 5.6% | 10.7% | 11.0% |
| Private | -0.7% | -0.9% | -4.8% | 4.7% | 12.0% | 13.8% |
| Residential | -2.4% | -2.3% | -17.8% | 0.5% | 13.7% | 18.7% |
| Nonresidential | 1.7% | 1.2% | 19.5% | 15.2% | 7.8% | 3.8% |
| Public | 2.5% | 0.9% | 16.2% | 9.2% | 6.2% | 1.7% |
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.
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