U.S. Construction Spending Inches Up in December
by:Tom Moeller
|in:Economy in Brief
Summary
- Private construction increases steadily.
- Residential building strengthens, but nonresidential is little changed.
- Public sector construction weakens.
The value of construction put-in-place rose 0.2% (9.0% y/y) during December following a 0.6% November gain, revised from 0.4%. A 0.7% December rise had been expected in the Action Economics Forecast Survey. During all of 2021, the value of construction rose 8.2%, the strongest increase since 2015.
Private construction increased 0.7% (12.7% y/y) in December after a 0.8% November gain. Residential construction strengthened 1.1% (15.0% y/y) after a 0.7% November rise. Single-family building increased 2.1% (16.3% y/y), about the same as in November. Multi-family building rose 0.4% (9.1% y/y) and reversed November's 0.3% decline. Home improvement expenditures eased 0.1% (+15.2% y/y) in December after declining 0.8% in November.
Nonresidential private construction eased slightly (+9.1% y/y) in December after firm gains in each of the prior five months. Educational construction rose 0.8% (1.7% y/y) following four consecutive months of strong increase. Office building rose 0.7% (4.6% y/y) about the same as in November. Power building improved 0.1% (4.9% y/y) after holding steady in November. Transportation spending was little changed (-1.9% y/y) following a 5.4% surge. To the downside, communication construction fell 0.4% (-0.2% y/y) after a 0.1% rise and heath care construction fell 0.5% (+6.6% y/y) after a 0.2% increase. Manufacturing construction weakened 1.9% (+30.4% y/y) following four months of strong increase.
The value of public construction fell 1.6% (-2.9% y/y) in December after holding steady in November. Health care building declined 4.7% (+7.9% y/y) following a 2.3% increase. Power construction fell 0.7% (+47.7% y/y) following two months of strong increase. Residential construction declined 1.2% (-3.4% y/y) and added to November's 3.2% decline. Spending on educational buildings weakened 1.4% (-8.5% y/y) after rising 0.4% in November. Transportation building fell 3.0% (-6.3% y/y) after weakening 0.5% in November. Spending on highways and streets edged 0.1% higher (0.9% y/y) after falling 0.6% in November.
The construction spending figures, some of which date back to 1946, can be found in Haver's USECON database. The expectations reading is in the AS1REPNA database.
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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