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Economy in Brief

U.S. Construction Activity Strengthens
by Tom Moeller  December 1, 2016

The value of construction put-in-place increased 0.5% during October following little change in September, revised from -0.4%. September's figure also was revised up to 0.5%. October's reading was the highest level of activity since March. Construction was up 3.4% y/y following stronger growth from 2012 through 2015. The latest rise matched expectations in the Action Economics Forecast Survey.

Building activity in the private sector slipped 0.2% (+4.7% y/y), reflecting a 2.1% decline (+4.8% y/y) in nonresidential construction. Office construction fell 2.0% (+28.4% y/y), while commercial construction eased 0.7% (+6.1% y/y). Transportation building activity strengthened 5.1% (-9.5% y/y), but power construction declined 4.3% (+3.3% y/y).

Residential building increased 1.6% (4.7`% y/y) after a 0.6% improvement. Multi-family building activity improved 2.8% (11.4% y/y), the third straight month of strength. Single-family building also improved 2.8% (-1.6% y/y), and made up declines during the spring and summer. The value of improvements declined 0.6% (+13.0% y/y) after a 1.2% rise.

Public sector building activity jumped 2.8% (-0.6% y/y), but that left it 4.3% below the February peak. Commercial construction rebounded 10.4% (23.3% y/y) following a sharp September decline, and education facility activity increased 4.1% (11.7% y/y). Highway & street construction, which is roughly one-third of the public sector total, improved 1.9% (0.7% y/y) following a 2.8% September rebound.

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, %) Oct Sep Aug Oct Y/Y 2015 2014 2013
Total 0.5 -0.0 0.5 3.4 10.3 11.4 6.3
  Private -0.2 -0.1 0.4 4.7 12.5 15.4 10.9
    Residential 1.6 0.6 -0.1 4.7 16.8 14.6 20.1
    Nonresidential -2.1 -0.8 0.9 4.8 8.1 16.3 2.7
  Public 2.8 0.4 0.9 -0.6 4.5 1.9 -3.1
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