According to the latest monthly report by the U.S. Census Bureau, construction spending in the United States fell 1.3 percent in June to a seasonally adjusted annual rate of more than $1.2 trillion. In the big picture, news is still quite good; spending in the first half of 2017 was 4.8 percent higher than the same period in 2016.
The private construction market hardly saw any change at all, dropping just 0.1 percent to a rate of $940.7 billion from May’s number of $941.3 billion. Private residential construction fell 0.2 percent to a rate of $502.9 billion, and private nonresidential saw a slight rise of 0.1 percent to $437.3 billion.
The drop in spending was much more visible in public construction. In June, the seasonally adjusted annual rate fell 5.4 percent to $265.1 billion, while educational construction fell 5.5 percent to $67.5 billion, and highway construction fell 6.6 percent to $82.4 billion.
While 2017 has been an improvement on 2016 almost across the board, numbers have failed to meet the lofty expectations that analysts from Dodge Data & Analytics had at the outset of the year. (ELECTRICAL CONTRACTOR’s 2017 Construction Outlook, based on this data from Dodge Data & Analytics, can be read here.)
This drop continues a slightly downward trend that has developed in the last few months of the survey. After an initial jump in spending that was seen at the outset of 2017, the April, May and June reports have seen a slowdown in momentum. According to Construction Dive, these numbers may remain stagnant while owners and developers wait for a detailed infrastructure plan from the U.S. government.
However, there are signs that a new spending surge may be just around the corner. Construction added 16,000 net new jobs in June, residential starts are on the rise, and there is a growing construction backlog in the private sector. With a push from the government, construction spending could hit the next level pretty quickly.
The latest construction spending numbers can be found at www.census.gov/constructionspending.