Home » Construction Jan. Spending Up 1.5% from Dec., 10.4% from 2015
Construction spending posted positive results in January, with the value of completed projects rising 1.5% from December’s level to an annual rate of $1.14 trillion and 10.4% year over year, the U.S. Census Bureau says.
The bureau, part of the Commerce Dept., reported on March 1 that spending on residential projects put in place in January totaled a $439-billion seasonally adjusted rate. That was flat with December’s mark and up 7.6% from the year-earlier level.
Nonresidential construction increased 2.5% from December to $701.9 billion, and jumped 12.3% from January 2015.
Within the nonresidential sector, highway and street construction did particularly well, with completed projects’ value rising 14.6% month-to-month, to $110.7 billion and surging 33.9% compared with the year-earlier total.
Ken Simonson, Associated General Contractors of America chief economist, said that record high temperatures in January let highway projects continue that would have been put off until later, in some parts of the country.
Lodging also showed solid results, with spending up 6.3% from December and 34.8% year over year.
On the other hand, six of the Census Bureau’s 16 nonresidential construction sub-categories dipped in January from December’s figures, including commercial, educational and non-highway transportation. But all but one of those six segments—public safety—showed year-over-year gains.
Anirban Basu, Associated Builders and Contractor chief economist, said that the nonresidential sector’s increases from 2015 track with other indicators. For example, Basu said in a statement, “For many months, the average contractor has been reporting decent backlog.”
But he cautioned that “the industry’s overall outlook remains murky,” noting the weak global economy and a decline in U.S. corporate profitability.
The bureau also reported that overall public-sector construction climbed 4.5% in January to an annual rate of $309.4 billion, and jumped 13% from January 2015.
On a monthly basis, private construction edged up a bare 0.5% in January to an $831.4-billion annual rate but increased 9.5% year over year, the Census Bureau said.
AGC’s Simonson said, “Although favorable weather may have boosted these results, demand for many types of projects remains strong despite worries that the overall economy has slowed.”