Value of new construction drops 2.1% in January to $88.3 billion

Construction spending during January took a hit, as the Department of Commerce estimates as estimated it dropped 2.1% to a seasonally adjusted annual rate of $883.3 billion. However, the January figure is 7.1% above the Jan. 2012 estimate of $824.7 billion.

Private construction.Spending on private construction was at a seasonally adjusted annual rate of $614.2 billion, 2.6% below the revised December estimate of $630.9 billion. Residential construction was at a seasonally adjusted annual rate of $304.6 billion in January, nearly the same as the revised December estimate of $304.7 billion. Nonresidential construction was at a seasonally adjusted annual rate of $309.7 billion in January, 5.1% below the revised December estimate of $326.2 billion.

Public construction.In January, the estimated seasonally adjusted annual rate of public construction spending was $269.0 billion, 1% below the revised December estimate of $271.7 billion. Educational construction was at a seasonally adjusted annual rate of $63.7 billion, 3.5% below the revised December estimate of $66 billion. Highway construction was at a seasonally adjusted annual rate of $79.1 billion, 0.9% above the revised December estimate of $78.4 billion.

Ken Simonson, chief economist, Associated General Contractors, Arlington, Va., said in a press release, “At first glance, January was a bad month for construction, with a sharp drop in private nonresidential spending, along with small dips in residential and public construction. However, the January figure was higher than the year-ago level. Moreover, steep upward revisions today in the preliminary numbers for November and December suggest January may ultimately prove to have been positive, as well.

"Once more complete data is available, power construction should prove to be a strong category in 2013, along with manufacturing, multifamily and — at least in the first half of the year— single-family construction. But public construction, which has declined year-over-year for 28 straight months, appears to be headed still lower.”

 

 

 

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