Economy Watch: Multifamily Gains in Mixed Bag for Construction Spending

Posted on October 4, 2016

The Census Bureau reported on Monday that U.S. construction spending during August came in at an annualized rate of $1,142.2 billion, or 0.7 percent below the July total. The August 2016 figure is also 0.3 percent below the August 2015 total.

What’s dragging down the totals? There was a bit less private construction in August, 0.3 percent compared to the previous month. But more important, the rate of public construction spending in August was 2 percent below July. Year over year, public construction spending lagged even more, dropping 8.8 percent compared with August 2015. Private construction spending, by contrast, was up 3.3 percent year over year.

In the private sphere, construction spending was a mixed bag in August. Multifamily, which tends to be volatile, swung upward by 2.4 percent. Office construction was up 2.3 percent, and hotel construction gained 1.5 percent. Spending on single-family housing, manufacturing, and other commercial projects (including warehouses) all lost ground.

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