Monday, July 03, 2017

Construction Spending unchanged in May

by Bill McBride on 7/03/2017 11:57:00 AM

Earlier today, the Census Bureau reported that overall construction spending was unchanged in May:

Construction spending during May 2017 was estimated at a seasonally adjusted annual rate of $1,230.1 billion, nearly the same as the revised April estimate of $1,230.4 billion. The May figure is 4.5 percent above the May 2016 estimate of $1,177.0 billion.
Private spending decreased and public spending increased in May:
Spending on private construction was at a seasonally adjusted annual rate of $943.2 billion, 0.6 percent below the revised April estimate of $949.3 billion. ...

In May, the estimated seasonally adjusted annual rate of public construction spending was $286.9 billion, 2.1 percent above the revised April estimate of $281.0 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 increasing, and is still 25% below the bubble peak.

Non-residential spending is now 5% above the previous peak in January 2008 (nominal dollars).

Public construction spending is now 12% below the peak in March 2009, and 9% 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 11%. Non-residential spending is up slightly year-over-year. Public spending is down slightly year-over-year.

This was below the consensus forecast of a 0.5% increase for May, however spending for previous months were revised up.