Steel Markets

Construction Spending Rises in January

March 4, 2014

Construction spending in January rose 9.3 percent year-over-year to a seasonally adjusted annual rate of $943 billion, according to data released by the US Census Bureau. Construction spending was 0.1 percent higher than the revised SAAR of $941.9 billion in December 2013.

Private construction spending rose 0.5 percent to a SAAR of $670.8 billion from the revised December estimate of $667.5 billion. Residential construction spending rose 1.1 percent and non residential spending edged down 0.2 percent from SAAR estimates in December 2013, but when compared on a year-over-year basis rose 15 percent and 9.7 percent, respectively.

Public construction was at a seasonally adjusted annual rate of $272.3 billion, down 0.8 percent from the revised December estimate of $274.4 billion but up by 2.5 percent year-over-year.

The Associated General Contractors of America (AGC) reported overall construction spending increased on the strength of homebuilding and multifamily construction in both December and January despite adverse weather conditions. Ken Simonson, AGC chief economist, said public construction was up “on a year-over-year basis, but funding remains questionable.” The AGC urges Congress to pass new transportation funding as soon as possible.

“Even with spending on the rise, the construction industry remains vulnerable to any sudden downturn in demand,” said Stephen E. Sandherr, the association’s chief executive officer. “Letting highway investments lapse will only hurt overall economic growth and put more construction jobs at risk.”