Global| Jul 01 2021U.S. Construction Spending Falters in May
by:Tom Moeller
|in:Economy in Brief
Summary
• Private nonresidential building activity declines sharply. • Residential building improves slightly. • Public sector construction continues to ease. The value of construction put-in-place weakened 0.3% (+7.5% y/y) during May after [...]
• Private nonresidential building activity declines sharply.
• Residential building improves slightly.
• Public sector construction continues to ease.
The value of construction put-in-place weakened 0.3% (+7.5% y/y) during May after edging 0.1% higher in April, revised from 0.2%. A 0.5% May increase had been expected in the Action Economics Forecast Survey. Figures back through 2019 were revised.
Private construction slipped 0.3% (+13.2% y/y) in May and reversed a 0.3% April gain. Residential construction improved 0.2% (28.7% y/y) as single-family building rose 0.8% (46.1% y/y) for the second straight month. Multi-family building eased slightly (+25.6% y/y) after two months of strong increase. Home improvement expenditures fell 0.6% (+8.9% y/y) after holding steady in April.
Nonresidential construction declined 1.1% in May (-5.8% y/y) after falling 0.5% during April. Transportation building strengthened 5.5% (-4.0% y/y) and reversed the 4.0% April falloff. Offsetting this increase, lodging construction fell 3.0% (-23.2% y/y) and education construction declined 3.0% (-19.9% y/y). Commercial building eased 0.7% (-2.6% y/y) while office building held steady (-8.3% y/y).
The value of public construction fell 0.2% during May (-8.7% y/y). It was the fifth consecutive monthly decline. Spending on highways & streets, which makes up nearly one-third of public spending, improved 1.4% (-4.3% y/y) and outlays on health care units eased 0.4% (+1.3% y/y). Power construction rose 0.5% (5.6% 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, %) | May | Apr | Mar | May Y/Y | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|
| Total | -0.3 | 0.1 | 1.0 | 7.5 | 5.8 | 4.2 | 4.1 |
| Private | -0.3 | 0.3 | 1.4 | 13.2 | 6.0 | 2.1 | 4.0 |
| Residential | 0.2 | 0.7 | 2.2 | 28.7 | 15.1 | -2.2 | 3.5 |
| Nonresidential | -1.1 | -0.5 | 0.1 | -5.8 | -4.0 | 7.3 | 4.7 |
| Public | -0.2 | -0.6 | -0.2 | -8.7 | 5.2 | 11.1 | 4.3 |
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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