Tuesday, January 03, 2017

Construction Spending increased in November

by Bill McBride on 1/03/2017 02:34:00 PM

Earlier today, the Census Bureau reported that overall construction spending increased in November:

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during November 2016 was estimated at a seasonally adjusted annual rate of $1,182.1 billion, 0.9 percent above the revised October estimate of $1,171.4 billion. The November figure is 4.1 percent above the November 2015 estimate of $1,135.5 billion

During the first 11 months of this year, construction spending amounted to $1,070.9 billion, 4.4 percent above the $1,025.5 billion for the same period in 2015.
Both private and public spending increased in November:
Spending on private construction was at a seasonally adjusted annual rate of $892.8 billion, 1.0 percent above the revised October estimate of $884.3 billion ...

In November, the estimated seasonally adjusted annual rate of public construction spending was $289.3 billion, 0.8 percent above the revised October estimate of $287.1 billion.
emphasis added
Construction Spending Click on graph for larger image.

This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted.

Private residential spending has been generally increasing, but is 32% below the bubble peak.

Non-residential spending is now 4% above the previous peak in January 2008 (nominal dollars).

Public construction spending is now 11% below the peak in March 2009, and 10% above the austerity low in February 2014.

Year-over-year Construction SpendingThe second graph shows the year-over-year change in construction spending.

On a year-over-year basis, private residential construction spending is up 3%. Non-residential spending is up 6% year-over-year. Public spending is up 3% year-over-year.

Looking forward, all categories of construction spending should increase in the coming year.

This was above the consensus forecast of a 0.6% increase for November.  A solid report.