Construction spending during July 2017 was estimated at a seasonally adjusted annual rate of $1,211.5 billion, 0.6 percent (±1.5 percent) below the revised June estimate of $1,219.2 billion. The July figure is 1.8 percent (±1.8 percent) above the July 2016 estimate of $1,189.8 billion.
Highway construction was at a seasonally adjusted annual rate of $84.8 billion, 0.1 percent (±6.9 percent) above the revised June estimate of $84.7 billion
During the first seven months of this year, construction spending amounted to $691.2 billion, 4.7 percent (±1.3 percent) above the $659.9 billion for the same period in 2016.
Spending on private construction was at a seasonally adjusted annual rate of $945.5 billion, 0.4 percent (±1.0 percent) below the revised June estimate of $949.4 billion.
- Residential construction was at a seasonally adjusted annual rate of $517.5 billion in July, 0.8 percent (±1.3 percent) above the revised June estimate of $513.2 billion.
- Nonresidential construction was at a seasonally adjusted annual rate of $428.0 billion in July, 1.9 percent (± 1.0 percent) below the revised June estimate of $436.2 billion.
In July, the estimated seasonally adjusted annual rate of public construction spending was $266.0 billion, 1.4 percent (±2.6 percent) below the revised June estimate of $269.8 billion. Educational construction was at a seasonally adjusted annual rate of $66.2 billion, 4.4 percent (±3.9 percent) below the revised June estimate of $69.2 billion.
“Data works in strange ways,” said Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. “In July, overall national job growth remained strong, while construction statistics sagged. One month later, the construction jobs picture looks much brighter, while headline numbers for the broader economy appear a bit less benign.
“Rather than focusing on oscillations in monthly data, look at the broader picture,” said Basu. “Here’s what we know: The U.S. labor market remains strong, as evidenced by enormous numbers of job openings, and construction activity remains robust, especially in certain private segments. This helps explain the 44,800 net new positions added by nonresidential specialty trade contractors during the past year. There is even evidence of growing demand for public construction services, with the heavy and civil engineering segment adding another 6,600 net new positions in August and more than 45,000 during the past year.
“The result is that demand for construction workers continues to expand despite occasional contradictory information emerging from monthly statistics,” said Basu. “Accordingly, construction firms are increasing their scramble rate for employees, driving up hourly compensation in the process. Leading indicators suggest that overall construction activity will continue to expand during the months ahead. Among these are the Architecture Billings Index and ABC’s Construction Backlog Indicator.
“Hopefully more Americans will enter the labor market and join apprenticeship or other training programs to participate in the nation’s steadily improving construction economy,” said Basu. “Not only will this make it easier for firms to deliver construction services on time and on budget, but it will also expand the nation’s tax base, shrink demand for public assistance, expand the middle class and accelerate economic growth.”