APRIL CONSTRUCTION SPENDING DOWN 0.4%, FOLLOWING DECLINE OF 0.6% IN MARCH
The value of new construction spending fell 0.4% in April, not quite as steep a decline as analysts had expected. The March decline was less severe than previously reported, down 0.6% rather than the 1.1% decline reported last month.
Residential construction fell 2.3%, its 26th straight month of decline now that the previously reported February increase has been revised to a 1.3% decline. The March residential number was revised upward but still showed a 3% decline compared with last month’s reported 4.6% decline.
The decline in residential construction offset the 1.6% increase in private nonresidential construction, its largest percentage increase since last September. March’s increase was revised down to 1.2% from the previously reported 1.9% increase. Private nonresidential spending rose in almost all sectors except for communications facilities and amusement and recreational facilities. Manufacturing and power facilities showed strong gains for the month but the largest percentage increase was for lodgings, up 7.6%.
Public construction fell 0.3% as a 0.5 decline in state and local spending offset a 1.6% increase in Federal construction. The largest declines in public construction were in power facilities, sewage treatment conservation spending. However, spending on educational facilities also fell slightly. Construction spending for streets and highways was almost unchanged for the month. Spending rose for public residential housing, health care facilities and public safety.
On a year-over-year basis construction spending is down 3.9% from last April primarily reflecting the 20.8% decline in the value of residential construction. Private nonresidential construction is up 15.4% and public spending is up 6.8% from last year.
The Commerce Department reported today that starting on July 1, with the release of the May data, there will be a change in the way that the construction numbers are reported. Improvements to rental, vacant and summer homes will no longer be included in the private residential series.