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Economy in Brief

U.S. Construction Spending Declines During February
by Tom Moeller  April 1, 2021

• Harsh winter weather curtailed building activity.

• Residential decline led by multi-family sector.

• Public-sector building weakened.

Building activity weakened as severe winter weather curtailed activity. The value of construction put-in-place fell 0.8% (+5.3% y/y) during February following a 1.2% January increase, revised from 1.7%. A 0.9% February decline had been expected in the Action Economics Forecast Survey.

Private construction eased 0.5% (+7.1% y/y) in February following a 1.5% January rise. Residential construction slipped 0.2% (+21.1% y/y) as multi-family building declined 1.4% (+14.6% y/y) and reversed the prior month's 1.2% gain. It had been rising steadily for nine months. Single-family building edged 0.1% higher (20.9% y/y) following seven straight months of notably strong increase. Home improvement expenditures eased 0.2% (+23.9% y/y) after rising 1.1% in January.

Nonresidential private construction declined 1.0% in February (-9.7% y/y), the seventh decline in eight months. Transportation building rose 0.8% (-2.9% y/), strong for the sixth straight month. Lodging construction fell, however, by 3.2% (-23.9% y/y) and commercial building weakened 1.2% (-7.1% y/y). Education construction fell 1.9% (-17.3% y/y). Office building eased 0.5% (-5.0% y/y), off just slightly for the third straight month.

Public construction fell 1.7% during February (-0.3% y/y) following two months of slight increase. Spending on highways & streets, which makes up nearly one-third of public spending, slipped 0.6% (-1.0% y/y) but outlays on health care units improved 1.4% (8.8% y/y). Power construction fell 0.9% (-3.4% y/y).

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.

Construction Put in Place (SA, %) Feb Jan Dec Feb Y/Y 2020 2019 2018
Total -0.8 1.2 2.1 5.3 4.7 2.3 4.1
  Private -0.5 1.5 2.7 7.1 4.6 0.6 4.0
    Residential -0.2 2.2 5.0 21.1 11.3 -2.5 3.5
    Nonresidential -1.0 0.4 -0.8 -9.7 -2.9 4.4 4.7
  Public -1.7 0.4 0.2 -0.3 5.2 8.0 4.4
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