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Economy in Brief

U.S. Construction Activity Is Stable
by Tom Moeller  September 1, 2016

The value of construction put-in-place remained little changed during July (+1.5% y/y) following a 0.9% June rise, revised from -0.6%. Despite the recent m/m stability, y/y growth in the value of construction activity has been weakening sharply. A 0.5% July increase was expected in the Action Economics Forecast Survey.

Building activity in the private sector improved 1.0% (4.4% y/y), led by a 1.7% increase (7.1% y/y) in nonresidential construction which followed a 1.6% rise. June & May figures were revised sharply upward. Office building jumped 4.6% (30.3% y/y) and commercial construction increased 1.2% (13.5% y/y). Factory sector building rose 3.9% (-5.1% y/y), but amusement & recreation construction fell 3.9% (+15.4% y/y).

The value of residential building activity improved 0.3% (1.9% y/y). Single-family construction eased 0.2% (+1.7% y/y), down for the sixth month this year. Multi-family construction activity fell 0.6% (+19.8% y/y), down for the third month in four. Offsetting these declines was a 1.5% rise (-3.8% y/y) in the value of improvements, the third consecutive increase.

The value of public sector building activity declined 3.1% (-6.5% y/y), the fourth fall in five months. Commercial building declined 12.5% (-19.5% y/y) and power construction fell 27.1% (-31.7% y/y). Offsetting these shortfalls was a 0.3% improvement (-1.4% y/y) in highways and streets construction, and a 2.5% gain (1.9% y/y) in health care building.

The construction spending figures are in Haver's USECON database and the expectations figure is contained in the AS1REPNA database.

Construction Put in Place (SA, %) Jul Jun May Jul Y/Y 2015 2014 2013
Total -0.0 0.9 0.1 1.5 10.3 11.4 6.3
  Private 1.0 0.7 0.7 4.4 12.5 15.4 10.9
    Residential 0.3 -0.1 -0.2 1.9 16.8 14.6 20.1
    Nonresidential 1.7 1.6 1.7 7.1 8.1 16.3 2.7
  Public -3.1 1.3 -1.5 -6.5 4.5 1.9 -3.1
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