March Construction Spending Record Setting

Washington, DC, May 4–Construction spending rose to a record annual pace of $944.1 billion, as work increased on highways and other public works as well as private homes.

Spending increased 1.5 percent, three times the rate expected, and February’s previously reported decline was revised to a 0.4 percent increase, the Commerce Department said in Washington. Private residential construction, which accounts for more than half the total, rose 0.7 percent to $507.2 billion.

Economists had expected spending to increase 0.5 percent to $925.7 billion, according to the median of 53 forecasts in a Bloomberg News survey. Estimates ranged from no change to a 2.5 percent rise.

Private construction rose 0.4 percent to an all-time high of $722.4 billion. The value of public construction rose 5.2 percent to a record $221.7 billion at an annual rate.
Federal construction spending rose 7.2 percent, the biggest increase since April 2003, to $16.6 billion. State and local spending on construction rose 5 percent to $205.1 billion, a record.

Private nonresidential building fell 0.2 percent to $215.2 billion. Private investment in factories and related buildings fell 3.8 percent to $12.8 billion. Power construction projects fell 4.9 percent in value to $30.8 billion. Private construction of office buildings rose 2.9 percent in March to a $32.2 billion pace.

Investment in plants, buildings and other structures fell at a 6.5 percent annual rate in the first quarter, the largest drop since 14.6 percent in the third quarter of 2002, the government said last week.