Construction spending jumped 1.7% in April on nonresidential building and multi-family job sites according to the monthly survey by the Census Bureau. The April increase was larger than month-to-month changes earlier this year even after spending totals for earlier months were revised higher from initial reports.
The increase in the nonresidential market was offset by a decline in the larger single family market.Overall, construction spending declined 0.1% in April from March.
The large increase in April was primarily for factories, hotels and offices, including large increases for chemical facilities where capacity expansion is always very late in the business cycle and for electronics facilities where the huge capacity surplus from the last recession has finally been absorbed.
Construction spending in the nonresidential building and multi-family markets is expected to increase 12% this year and 10% more in 2007 as a result of the recent pickup in project starts.Reed Construction Data reports that the value of starts is up 14.2% year-to-date compared to a year ago for nonresidential buildings.
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Construction Spending |
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($millions, seasonally adjusted annual rate) |
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April '06 |
March '06 |
% change |
YTD |
% change |
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Apr. vs. Mar. |
Apr. '06 |
06 vs. '05 |
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Education |
81,290 |
82,316 |
-1.2 |
81,897 |
9.6 |
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Commercial (retail) |
75,941 |
74,720 |
1.6 |
75,342 |
8.4 |
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Multi-Family |
60,325 |
59,629 |
1.2 |
59,505 |
16.7 |
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Office |
50,945 |
49,559 |
2.8 |
50,026 |
8.4 |
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Health Care |
39,248 |
39,164 |
0.2 |
38,978 |
10.4 |
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Manufacturing |
36,669 |
33,994 |
7.9 |
34,297 |
21.8 |
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Amusement/Recreation |
21,011 |
20,835 |
0.8 |
20,843 |
10.3 |
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Lodging |
15,883 |
14,490 |
9.6 |
14,307 |
17.4 |
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Public Safety |
10,855 |
11,040 |
-1.7 |
10,759 |
19.1 |
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Religious |
8,314 |
8,174 |
1.7 |
7,946 |
0.0 |
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Total |
400,481 |
393,921 |
1.7 |
393,898 |
11.6 |
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Source: Census Bureau |
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and Reed Construction Data |
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