Commercial construction spending sends mixed signals
SBJ Staff
Posted online
Overall construction spending is still down, but private nonresidential construction spending moved up 0.8 percent in July from the previous month.
The bump in spending to $266 billion in July, from $264 billion in June, is the first increase in the private nonresidential construction subset since March 2009, according to the U.S. Census Bureau construction spending report, released Sept. 1.
Despite the increase, private nonresidential spending is down 23.7 percent from $348.9 billion in July 2009, the report said.
Nonresidential spending in the public sector was down 1.3 percent to $288.5 billion July, compared to $292.2 billion the previous month. Public nonresidential spending in July 2009 topped $315.8 billion, 8.6 percent above July 2010 sales.
Total construction sales in July were $805.2 billion, down 1 percent from June sales of $813 billion and down 10.7 percent compared to July 2009 sales of $901.2 billion, according to the report.
Associated Builders and Contractors Inc., a national association representing 25,000 construction firms, issued a statement following the U.S. Census Bureau results.
"In a reversal of pre-existing and long-lived trends, privately-financed construction volumes were up in July while publicly-financed construction was down," ABC Chief Economist Anirban Basu said in the release. "While there are numerous perspectives on whether or not this is to be interpreted positively or negatively, our view is that this is not good news."
Basu went on to give two reasons justifying the organization's conclusion. The impact of the stimulus package passed in February 2009 has peaked, and the momentum in privately-financed activity in July will not last since overall construction totals are still down, he said.[[In-content Ad]]