Ed Kashmarek - The Everyday Economist
  • Home
  • About
    • Skills
    • Volunteering
    • Music
    • Microfinance
    • Photos
    • Book List
  • Work Samples
  • Reports
  • Blog
  • Charts
  • Podcast
  • Webinars
  • Tableau
    • Employment Analysis Tool (Web)
    • Employment Analysis Tool (Mobile)
    • GDP Analysis Tool (Web)
    • GDP Analysis Tool (Mobile)
    • MN Housing
  • Feedback
  • Join Email List
  • Booking

Construction Spending Plunges in June and the Weakness is Widespread

8/3/2017

1 Comment

 
​According to the Commerce Department, total construction spending plunged by $15.8 billion, or 1.3%, in June to $1.21 trillion, widely missing the consensus forecast of a 0.5% increase. This follows a 0.3% increase in May that was revised up from no change. Compared to a year ago, spending was up just 1.6%, the least since November 2011. 
Picture
Weakness was widespread in June. Residential spending fell by $1.4 billion, or 0.3%, from the prior month but was up 9.0% from the prior year. Non-residential spending plunged by $14.4 billion, or 2.0%, and was down 3.1% from the prior year, the worst in four years.

For non-residential spending, only two of fifteen categories saw spending increases. Spending on office projects rose by $1.4 billion, or 1.9%, and spending on communications projects rose by $612 million, or 2.8%. Every other category saw spending fall, led by a huge $5.7 billion, or 6.4%, decline in spending on highways and streets, which took the level of spending down to the lowest in over three years. Other notable declines were a $3.9 billion, or 4.3%, decline in education spending and a $1.2 billion, or 1.8%, decline in manufacturing. The biggest percentage declines came in conservation and development, where spending dropped 7.3%, and public safety, where spending fell 6.5% from the prior month.                 

​Private spending only fell by $573 million, or 0.1%, with all of the decline coming from residential projects. Although non-residential spending rose by $503 million, or 0.1%, that included a $1.8 billion, or 2.9%, increase in spending on office projects and a $1.3 billion, or 1.9%, decrease in manufacturing. Meanwhile, public spending cratered by $15.2 billion, or 5.4%, half of which came from just two categories, with highway and street projects falling by $5.8 billion, or 6.6%, and education spending dropping by $3.9 billion, or 5.5%. Thus, 94% of the drop in total  spending came from public non-residential projects.  
Picture
Compared to a year ago, the strongest growth in total construction spending has come from residential, office and commercial projects. Conversely, the biggest declines have been seen in conservation/development, sewage and waste disposal and water supply.

​Last week the Federal Reserve held the Fed Funds rate steady. Today’s very weak report suggests that was a wise move. With inflation slowing, Treasury yields and mortgage rates have been trending down, which should help to support the construction industry. 
1 Comment
Garden Fountains Ohio link
12/9/2022 01:03:40 am

Great blog you have herre

Reply



Leave a Reply.

    Archives

    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    June 2013
    May 2013

    Categories

    All
    Construction Spending
    CPI
    Employment Report
    Existing Home Sales
    GDP
    Housing Market Index
    Import Prices
    Industrial Production
    Leading Economic Indicators
    New Home Sales
    Personal Income And Outlays
    Producer Prices
    Retail Sales
    Small Business Optimism
    Trade

    RSS Feed

Proudly powered by Weebly